Jennifer Burns, Goddess of the Market: Ayn Rand and the American Right (London: Oxford University Press, 2009).
Anne Conover Heller, Ayn Rand and the World She Made (New York: Nan A. Talese, 2009).
Ayn Rand, The Fountainhead (New York: Bobbs-Merrill, 1943).
Ayn Rand, Atlas Shrugged (New York: Random House, 1957).
Peter Thiel, “The Education of a Libertarian,” Cato Institute, April 2009, www.cato-unbound.org/2009/04/13/peter-thiel/education-libertarian.
Hans Hermann-Hoppe, Democracy—The God That Failed (Newark: Transaction, 2001).
Greg Satell, “Peter Thiel’s Four Rules for Creating a Great Business,” Forbes, October 3, 2014, www.forbes.com/sites/gregsatell/2014/10/03/peter-thiels-4-rules-for-creating-a-great-business/2/#2ea53ac12804.
Brad Stone, The Everything Store: Jeff Bezos and the Age of Amazon (New York: Little, Brown and Company, 2013).
Chapter Five: Digital Destruction
The film The Social Network, written by Aaron Sorkin and directed by David Fincher, is a remarkably honest telling of the birth of Facebook.

…

Speaking at the Black Hat USA cybersecurity conference in 2015, longtime tech security guru Dan Kaminsky said, “Half of all Americans are backing away from the net due to fears regarding security and privacy. We need to go ahead and get the Internet fixed or risk losing this engine of beauty.”
People like Google CEO Larry Page, Facebook’s Mark Zuckerberg, PayPal founder Peter Thiel, and Sean Parker of Napster and Facebook fame are among the richest men in the world, with ambitions so outsize that they are the stuff of fiction: Dave Eggers’s The Circle and Don DeLillo’s Zero K are populated with tech billionaires inventing technology that will enable people to live forever. But this scenario is happening in real life. Peter Thiel, Larry Page, and others are investing hundreds of millions of dollars in research to “end human aging” and to merge human consciousness into their all-powerful networks. As George Packer, writing in the New Yorker, put it, “In Thiel’s techno-utopia a few thousand Americans might own robot-driven cars and live to a hundred and fifty, while millions of others lose their jobs to computers that are far smarter than they are, then perish at sixty.”

…

First, he kept Zuckerberg centered on Facebook, even though the young coder was spending a lot of time writing another program called Wirehog, which was essentially a version of Napster. Parker convinced him that it would be nothing but trouble in the form of lawsuits from the content community. The genius of Facebook was that the users provided all the content. There was no need to steal pictures, as he had for Facemash, or music files, as Parker had done for Napster. The second thing Parker did was to introduce Zuckerberg to Peter Thiel.
Peter Thiel grasped almost immediately the potential of Facebook. As David Kirkpatrick explained in The Facebook Effect: The Inside Story of the Company That Is Connecting the World, “What happened once it opened at a new school was what most impressed Thiel. Within days it typically captured essentially the entire student body, and more than 80 percent of users returned to the site daily!” This was unprecedented, and Thiel knew that Facebook fit all four of his success categories.

My fellow authors Candice Jackson and Alec Rawls provided me with invaluable feedback as I prepared my manuscript. I also appreciate Ron Kenner’s editing assistance and Sharon Goldlinger’s astute guidance. Brandi Laughey, Jonathan New, Nancy Humphreys, and Steven Phenix have been wonderful to work with. And I’ve never met a more thorough or trustworthy adviser than Hank Terry.
I would also like to thank my PayPal compatriots, including Peter Thiel, Max Levchin, David Sacks, and Paul Martin, for providing me with their time and feedback; while the conclusions reached in this book are ultimately my own, I nonetheless appreciate their support and enthusiasm.
Friends and family played no small role in this endeavor, and my wife, Beatrice, played a role above and beyond all others; without her steadfast devotion and countless hours laboring alongside me, this project would not have been possible.

Eduardo Saverin owns 5 percent, Sean Parker about 4 percent, and Peter Thiel around 3 percent (he sold about half his holdings in late 2009, mostly to Digital Sky). Greylock Partners and Meritech Capital Partners each have between 1 percent and 2 percent. Microsoft owns about 1.3 percent, and Hong Kong billionaire Li Ka-shing about .75 percent. Advertising giant The Interpublic Group owns a little less than half a percent, the happy heritage of an ad-and-equity deal in Facebook’s early days. A amall group of current and former employees own a substantial share but less than 1 percent. They include Matt Cohler, Jeff Rothschild, Adam D’Angelo, Chris Hughes, and Owen Van Natta. Others with sizable holdings include Reid Hoffman and Mark Pincus, who invested alongside Peter Thiel in the company’s very first financing round, as well as Western Technology Investments (WTI) which loaned the company a total of $3.6 million in its first two years, and invested $25,000 in that same initial round.

…

As Facebook grows and grows past 500 million members, one has to ask if there may not be a macro version of the Facebook Effect. Could it become a factor in helping bring together a world filled with political and religious strife and in the midst of environmental and economic breakdown? A communications system that includes people of all countries, all races, all religions, could not be a bad thing, could it?
There is no more fervent believer in Facebook’s potential to help bring the world together than Peter Thiel. Thiel is a master contrarian who has made billions in his hedge fund betting correctly on the direction of oil, currencies, and stocks. He is also an entrepreneur, the co-founder, and former CEO of the PayPal online payments service (which he sold to eBay). He was the very first professional investor to put money in Facebook, in the late summer of 2004, and he’s been on the company’s board of directors ever since.

…

Hoffman was impressed with Thefacebook almost immediately but didn’t want to be its lead investor, given his involvement in LinkedIn. By mid-2004, many in the Internet industry were beginning to wonder if social networking might ultimately all converge in one big network. Although Hoffman didn’t believe that himself, he knew that some would see it as a conflict of interest if he led an investment in Thefacebook. So he arranged for Parker and Zuckerberg to meet with Peter Thiel, the brooding, dark-haired financial genius who had co-founded and led PayPal and was now a private investor.
Hoffman is a key member of a very distinct and important Silicon Valley subculture—the wealthy former employees of PayPal. Hoffman remained close to many onetime PayPal colleagues, including Thiel. PayPal created the first successful large-scale online payment system and sold itself to eBay for $1.5 billion in October 2002, just two years after it was created in a merger of two start-ups.

This time, he was looking for something really life changing. Sure, everyone was looking for the next big thing. The difference was, Sean knew what the next big thing was. He knew with a complete, and almost religious certainty:
Social Networks.
Just a few months ago, he’d made some connections at the social network site Friendster. He’d brought them some series D VC funding, introduced them to his buddies around town—most notably, Peter Thiel, the guy behind PayPal, a colleague who’d also experienced some run-ins with the gang at Sequoia.
But Friendster wasn’t going to be Sean Parker’s next home run; it was already too far along, and Sean wasn’t getting in anywhere near the ground floor. And to be honest, Friendster had its limitations. It was really a dating Web site. A good one, more disguised than Match or JDate, but it was about meeting chicks you didn’t know and trying to get their e-mail.

…

Formerly the Bank of America Center, the behemoth at 555 California Street was an architectural wonder, an enormous, polished granite tower with thousands of bay windows that could be seen for miles, a 750-foot spire rising right out of the epicenter of the city’s financial district.
And the man they were on their way to meet—well, he was nearly as impressive as the building itself, both in personal reputation and in what he had already achieved.
“Peter’s going to love you,” Sean responded. “Fifteen minutes, in and out, that’s all it’s going to take.”
Deep down, he was certain that he was right. Peter Thiel—the founding force behind the incredibly successful company PayPal, head of the multibillion-dollar venture fund Clarium Capital, former chess master, and one of the richest men in the country—was intimidating, fast-talking, and a true genius—but he was also exactly the sort of angel investor who had the guts and the foresight to understand how important—how groundbreaking—thefacebook had the potential to be.

…

It wasn’t life-changing money, it wasn’t empire-making money, it wasn’t fuck-you money—it wasn’t even as much money as Mark had once turned down, back in high school, when he’d created that MP3 player add-on, simply because he didn’t really give a damn about money, whether it was a thousand dollars borrowed from a friend to start a company, or a million dollars thrown his way from an even bigger company. As far as Sean could tell, Mark still didn’t really give a damn about money; but he couldn’t ignore the sentiment that came with those five hundred thousand dollars, the promise of a future for the company that he’d started in that Harvard dorm room.
Peter Thiel had been exactly everything that Sean had prepared Mark for. Scary as hell, brilliant as hell—and willing to play ball. More than that, he’d turned a fifteen-minute pitch meeting into a lunch and an afternoon spent going over the details—of the deal that would ensure thefacebook’s survival, once and for all. At one point, Sean and Mark had even been sent out of the meeting, to walk around town while Thiel and Hoffman and Kohler discussed their pitch—but by the end of the afternoon, Thiel had given them the great news: thefacebook was on its way.

Further, the publisher does not have any control over and does not assume any responsibility for author or third-party Web sites or their content.
http://us.penguingroup.com
Acknowledgments
For useful comments and discussions, I wish to thank Peter Thiel, Daniel Sutter, Alex Tabarrok, Garett Jones, Bryan Caplan, Robin Hanson, Michael Mandel, Stephen Morrow, Natasha Cowen, Teresa Hartnett, John Nye, Jason Fichtner, Michelle Dawson, Nathan Molteni, Michael Munger, seminar participants at Duke University, and Jayme Lemke. I dedicate this work to Michael Mandel and Peter Thiel, who have blazed the way.
The Low-Hanging Fruit We Ate
Land, Technology, and Uneducated Kids
America is in disarray and our economy is failing us. We have been through the biggest financial crisis since the Great Depression, unemployment remains stubbornly high, and talk of a double-dip recession persists.

…

Paul Krugman, Nouriel Roubini, and Jeffrey Sachs are all more famous, prizewinning commentators on the questions of macroeconomics and development, and from them you will hear a lot of talk about liquidity traps, currency crises, and the future of Africa. But this group misses many of the critical angles of science and technology and the broader historical picture of how a technological plateau is possible. Peter Thiel, a cofounder of PayPal and an early investor in Facebook (he shows up as a character in the movie Social Network, albeit poorly portrayed), also deserves credit for promoting the idea of an innovation and productivity slowdown. In an interview with The Wall Street Journal, he put it bluntly: “People don’t want to believe that technology is broken.... Pharmaceuticals, robotics, artificial intelligence, nanotechnology—all these areas where the progress has been a lot more limited than people think.

…

I am using a pre-crisis number to adjust for the fall in GDP from the financial crisis; in that sense, this number is an approximate one and thus a more conservative estimate than what a completely current calculation would yield.
For one example of Michael Mandel’s writings, see “Official GDP, Productivity Stats Tell a Different Story of U.S. Economy,” Seeking Alpha, May 10, 2010, http://seekingalpha.com/article/204083-official-gdpproductivity-stats-tell-a-different-story-of-u-s-economy. The Peter Thiel quotation is from Holman W. Jenkins Jr., “Technology = Salvation, An early investor in Facebook and the founder of Clarium Capital on the subprime crisis and why American ingenuity has hit a dead end,” The Wall Street Journal, October 9, 2010.
Chapter 3
Does the Internet Change Everything?
Some of the employment figures from respective corporate Web sites. See http://investor.ebay.com/faq.cfm, http://investor.google.com/corporate/faq.html#employees, www.facebook.com/press/info.php?

Vast increases in biological and machine intelligences will create what’s being called the Singularity—a threshold of time at which AIs that are at least as smart as humans, and/or augmented human intelligence, radically remake civilization.
A belief in a coming Singularity is slowly gaining traction among the technological elite. As the New York Times reported in 2010, “Some of Silicon Valley’s smartest and wealthiest people have embraced the Singularity.”4 These early adopters include two self-made billionaires: Peter Thiel, a financial backer of the Singularity Institute for Artificial Intelligence, and Larry Page, who helped found Singularity University. Peter Thiel was one of the founders of PayPal, and after selling the site to eBay, he used some of his money to become the key early investor in Facebook. Larry Page cofounded Google. Thiel and Page obtained their riches by successfully betting on technology.
Famed physicist Stephen Hawking is so concerned about a bad Singularity-like event that he warned that computers might become so intelligent that they could “take over the world.”

…

—Vernor Vinge, computer scientist; Hugo Award-winning author, A Fire Upon the Deep; essayist, “The Coming Technological Singularity”
“The arrow of progress may kick upwards into a booming curve or it may terminate in an existential zero. What it will not do is carry on as before. With great insight and fore thought, Miller’s Singularity Rising prepares us for the forking paths ahead by teasing out the consequences of an artificial intelligence explosion and by staking red flags on the important technological problems of the next three decades.”
—Peter Thiel, self-made technology billionaire; co-founder, Singularity Summit
“Many books are fun and interesting, but Singularity Rising is fun and interesting while focusing on some of the most important pieces of humanity’s most important problem.”
—Luke Muehlhauser, executive director, Singularity Institute
“We’ve waited too long for a thorough, articulate, general-audience account of modern thinking on exponentially increasing machine intelligence and its risks and rewards for humanity.

…

I’ve become convinced that if an unfriendly ultra-AI is the greatest threat facing humanity, Eliezer’s efforts represent our best hope of survival.
In the year 2000, Eliezer founded the Singularity Institute for Artificial Intelligence. Although the Institute has garnered less support than Eliezer believes is justified, the best testament to Eliezer’s credibility comes from the quality of the people who have either contributed to the Institute or have spoken at one of its events. These include:
•Peter Thiel—self-made tech billionaire and key financier behind Face-book. Donated $1.1 million to the Institute;91
•Ray Kurzweil—famed investor and Singularity writer;
•Justin Rattner—Intel’s chief technology officer;
•Eric Drexler—the father of nanotechnology;
•Peter Norvig—Director of Research at Google;
•Aubrey de Grey—leading longevity researcher;
•Stephen Wolfram—developer of the computation platform Mathematica; and
•Jaan Tallinn—founding engineer of Skype and self-made tech decamillionaire who donated $100,000.92
I also spoke on the economics of the Singularity at the Institute’s 2008 Summit.

He’s a Ferrari-driving, Stanford-educated moral philosopher, a chess genius and multibillionaire investor who is accompanied everywhere by a “staff of two blond, black-clad female assistants, a white-coated butler and a cook who prepares a daily health drink of celery, beets, kale, and ginger.”71
It would be easy, of course, to dismiss Peter Thiel as an eccentric with cash. But that’s the least interesting part of his story. He is, in fact, an even richer, smarter, and—as a major funder of radical American libertarians like Rand Paul and Ted Cruz—more powerful version of Tom Perkins. Peter Thiel has everything: brains, charm, prescience, intellect, charisma; everything, that is, except compassion for those less successful than him. In the increasingly unequal America described in Packer’s The Unwinding, Thiel is the supreme unwinder, a hard-hearted follower of Ayn Rand’s radical free-market philosophy who unashamedly celebrates the texture of inequality now reshaping America.

…

The Internet economy “produces very valuable companies with very few employees,” Brooks says of this crisis, while “the majority of workers are not seeing income gains commensurate with their productivity levels.”69
In his 2013 National Book Award–winning The Unwinding, George Packer mourns the passing of the twentieth-century Great Society. What he calls “New America” has been corrupted, he suggests, by its deepening inequality of wealth and opportunity. And it’s not surprising that Packer places Silicon Valley and the multibillionaire Internet entrepreneur and libertarian Peter Thiel at the center of his narrative.
The cofounder, with Elon Musk, of the online payments service PayPal, Thiel became a billionaire as the first outside investor in Facebook, after being introduced to Mark Zuckerberg by Sean Parker, the cofounder of Napster and Facebook’s founding president. The San Francisco–based Thiel lives in a “ten thousand square foot white wedding cake of a mansion,” 70 a smaller but no less meretricious building than the Battery.

…

Cowan underlines the “stunning truth” that wages for men, over the last forty years, have fallen by 28%.78 He describes the divide in what he calls this new “hyper-meritocracy” as being between “billionaires” like the Battery member Sean Parker and the homeless “beggars” on the streets of San Francisco, and sees an economy in which “10 to 15 percent of the citizenry is extremely wealthy and has fantastically comfortable and stimulating lives.”79 Supporting many of Frank and Cook’s theses in their Winner-Take-All Society, Cowen suggests that the network lends itself to a superstar economy of “charismatic” teachers, lawyers, doctors, and other “prodigies” who will have feudal retinues of followers working for them.80 But, Cowen reassures us, there will be lots of jobs for “maids, chauffeurs and gardeners” who can “serve” wealthy entrepreneurs like his fellow chess enthusiast Peter Thiel.
The feudal aspect of this new economy isn’t just metaphorical. The Chapman University geographer Joel Kotkin has broken down what he calls this “new feudalism” into different classes, including “oligarch” billionaires like Thiel and Uber’s Travis Kalanick, the “clerisy” of media commentators like Kevin Kelly, the “new serfs” of the working poor and the unemployed, and the “yeomanry” of the old “private sector middle class,” the professionals and skilled workers in towns like Rochester who are victims of the new winner-take-all networked economy.81
The respected MIT economists Erik Brynjolfsson and Andrew McAfee, who are cautiously optimistic about what they call “the brilliant technologies” of “the Second Machine Age,” acknowledge that our networked society is creating a world of “stars and superstars” in a “winner-take-all” economy.

“There are aspects of it that are great and aspects that are terrible, and there are some real choices humans have to make about which technologies to foster and which ones we should be more careful about.”
Peter Thiel is entitled to his idiosyncratic views, of course, but they’re worth paying attention to because they increasingly shape the world we all live in. There are only four other people on the Facebook board besides Mark Zuckerberg; Thiel is one of them, and Zuckerberg publicly describes him as a mentor. “He helped shape the way I think about the business,” Zuckerberg said in a 2006 Bloomberg News interview. As Thiel says, we have some big decisions to make about technology. And as for how those decisions get made? “I have little hope,” he writes, “that voting will make things better.”
“What Game Are You Playing?”
Of course, not all engineers and geeks have the views about democracy and freedom that Peter Thiel does—he’s surely an outlier. Craig Newmark, the founder of the free Web site craigslist, spends most of his time arguing for “geek values” that include service and public-spiritedness.

One of the leading companies in the open data space is Palantir Technologies. It was highlighted by the civic-minded Code for America; it sponsored O’Reilly’s Gov 2.0 summit and adopts his “Government as a Platform” terminology, and was an early partner of USAid’s Food Security Open Data Challenge.52 Palantir received early funding from the CIA’s In-Q-Tel venture capital arm and from Peter Thiel’s Founders Fund, both organizations known for their deep commitment to openness and equality. Peter Thiel is Palantir’s Chairman of the Board: perhaps he will be pursuing open data projects for the secretive Bilderberg Group, on whose Steering Committee he sits?
It would be nice to think that the shift to open data might undermine some vested interests without re-enacting Animal Farm, but the prospects are not bright.
One lesson of cultural economics is that creative works for which there is significant demand in a small market can be swamped by near-zero-marginal cost exports from large markets.

…

Companies see themselves as enlightened participants in these debates, with a social mandate as well as a business mandate; Google’s “Don’t be evil” mantra encapsulates their belief that the company has a moral mission as well as a technological one.
Internet culture is also supremely ambitious and self-confident. It’s a confidence captured in venture capitalist Marc Andreessen’s saying that “software is eating the world.” In its outer reaches it is an ambition manifested in ideas of Seasteading (a movement to build self-governing floating cities, started by PayPal founder Peter Thiel) and the Singularity (a belief in “the dawning of a new civilization that will enable us to transcend our biological limitations and amplify our creativity,” originating with the ideas of inventor and now Google employee Ray Kurzweil).
Just as Hollywood is both a physical location and a global industry with a distinctive set of traditions, beliefs, and practices, so Silicon Valley is more than a place—it is shorthand for the world of digital technology, specifically Internet technology.

…

Whatever the intent of the more community-focused Peers activists, the group functioned in part as a front for Silicon Valley lobbying.
The funding behind the larger Sharing Economy companies highlights the contradictory currents that drive it. Billionaire and Amazon CEO Jeff Bezos has invested in both Airbnb and Uber; leading venture capital firm Andreessen Horowitz has invested in Airbnb, Lyft, and delivery service Instacart; Founders Fund, a firm set up and led by billionaire and ­PayPal founder Peter Thiel, has invested in Airbnb, Lyft, and TaskRabbit. ­Goldman Sachs is another investor in Uber as well as WeWork, which has also been funded by JP Morgan. Lending Club sends emails emphasizing that “Instead of paying interest to a credit card company or on a traditional bank loan, you get your loan through ordinary people like YOU who want to invest in YOUR success,” 14 but its board includes John Mack (ex–Morgan Stanley) and Larry Summers (former Treasury secretary).

Why was one group living in fear of the threat of job loss, unreasonably long hours, and shrinking wages, while another was so overwhelmed by new opportunities they don’t know what to do?
Two years after I’d first shown up in Bangkok, I finally got it.
What’s Your Secret?
“If you do things that are safe but feel risky, you gain a significant advantage in the marketplace.”
Seth Godin
Multi-millionaire investor Peter Thiel begins every interview with companies he’s considering investing in with the same three questions:
What’s your secret?
What important truth do very few people agree with you on?
What do you believe that is both contrarian and correct?
What Thiel and the group in Bangkok understood is based on an old axiom from Archimedes over two thousand years ago: “Give me a lever long enough and a fulcrum on which to place it, and I shall move the world.”

…

If you look at the current head coaches in the NBA or NFL, the 80/20 rule applies. 80% of them usually have common roots in apprenticing with 20% of the head coaches of the past generation.
Technology startups have started to develop “mafias,” or groups of successful entrepreneurs that can trace their roots back to a common source. Elon Musk (Currently of SpaceX and Tesla), Reid Hoffman (LinkedIn), and Peter Thiel (Palantir) all worked together at PayPal.42
Trajectory Theory—A Guide to Hiring an Apprentice (or Getting Hired)
Three-time New York Times bestselling author Tucker Max has hired a lot of people to work in an apprentice-type position, and they’ve almost always gone on to be successful in future projects and companies. Why is his track record so good?
In his words, he hires “people who have done things.”

Schumpeter further described entrepreneurialism as the “opening of a new market, that is a market into which the particular branch of manufacturer of the country in question has not previously entered.”4 Entrepreneurs are doing something entirely new, something that has never been tested by the markets before. By that very description, such ventures are most often going to end in failure.
Billionaire venture capitalist Peter Thiel earned his initial fortune as a cofounder of PayPal. However, his most famous investment success to this day was the $500,000 he invested in Facebook in 2004.5 His PayPal wealth meant that he had money to lose, and odds were the then largely unknown social network would not succeed. That his stake would eventually be measured in the billions is all the evidence we need to prove that he risked losing his entire investment.

…

Whatever the perks of being in Congress, or for that matter being an ex-politician, great investors can earn billions. So it’s no major insight to say that if Hillary Clinton, Joe Biden, or Marco Rubio had a clue about what companies and business concepts were going to prosper in the future, they would not be members of the political class.
Simply put, wealth in the hands of politicians is not the same as wealth in the hands of Bill Gates, Warren Buffett, Peter Thiel, or Jeff Bezos. Government can’t spend or invest us to prosperity for reasons of talent alone.
My sermonizing, while true, ultimately amounts to shooting fish in the most crowded of barrels. While the talent differential between politicians and successful investors is blindingly obvious, to point it out is arguably to miss the greater point. Undoubtedly, those who properly decry government in its role as venture capitalist can point to the massive government loan to now bankrupt Solyndra as one of many modern examples of how politicians don’t know how to invest.

[There were] a variety of possible good reasons to go, but none justified a trip in and of itself. He said, ‘There needs to be one decisive reason, and then the worthiness of the trip needs to be measured against that one reason. If I go, then we can backfill into the schedule all the other secondary activities. But if I go for a blended reason, I’ll almost surely come back and feel like it was a waste of time.’ ”
* * *
Peter ThielPeter Thiel (TW: @peterthiel, with 1 tweet and 130K+ followers; foundersfund.com) is a serial company founder (PayPal, Palantir), billionaire investor (the first outside investor in Facebook and more than a hundred others), and author of the book Zero to One. His teachings on differentiation, value creation, and competition alone have helped me make some of the best investment decisions of my life (such as Uber, Alibaba, and more).

The next speaker was Blake Mycoskie, founder of TOMS shoes (http://www.toms.com), a company famous for donating one pair of shoes to children in need for every pair it sells. Blake, of course, did not complete college. Peter Thiel (whom I introduced via e-mail to Elliott) spoke to the audience about his fellowship, and received powerful applause for his comments about the failure of higher education today.
A revolution is happening. All of a sudden, I was meeting kids everywhere who were waking up and realizing something profoundly important: they have more power and choice to control their own destiny than most parents, teachers, pundits, and politicians tell them. They don’t need to follow the crowd running into a building that’s burning down, just because everyone else is running into it. They have choice. They have the tools at their disposal now to create their own path through life.
Peter Thiel continued on this theme: “I was talking with someone here in San Francisco, who was running a foundation to get minority students into college and then into various tracked careers.

If you’re driven only by a desire for the status that is associated with being an entrepreneur, you’re not going to be willing to deal with the humiliation of sleeping on people’s couches.”
Sean famously connected with Mark Zuckerberg when TheFacebook was an infant, and played a crucial role in making Facebook what it is today, adding central innovations like photo sharing and friend-tagging, and introducing Zuckerberg to Peter Thiel (whom we’ll meet later in the book), Facebook’s first investor. Facebook is now well on its way to becoming the single point of login and user authentication for a large swath of the Internet. Sean, with a 7 percent stake in Facebook, is now worth billions.
So the first part of marketing has nothing to do with communications or ads or messages. It has to do with the concept of the product or service itself, and how well it is designed to meet needs/ solve the problems of a specific target market.

We are not mere spectators, and Arrison is no mere prophet. Instead, she truly is a great general, who is marshaling all of the vast forces of humanity in its titanic struggle against the Great Enemy of the world, whose true name is Death. I look forward to the battle being joined.
Death was natural in the past, but so was the instinct to fight it. The future only has room for one of them.
Peter Thiel
Spring 2011
San Francisco
CHAPTER 1
Humankind’s Eternal Quest for the Fountain of Youth
DR. TYRELL: What seems to be the problem?
ROY: Death.
—Blade Runner
FOR AS LONG as humans have been around, they have dreamed about living forever. Now, for the first time in history, science is bringing humanity closer to realizing that dream through advances that could potentially add hundreds of years to the average life span.

…

And even though Peterson is still the president of the Foresight Institute, she also organizes many successful conferences, including one called the Personalized Life Extension Conference: Anti-Aging Strategies for a Long Healthy Life.39 If that sounds like a fringe conference, think again. The headliner for the event was venture capitalist (VC) Ester Dyson, who sits on the board of directors for genomics company 23andMe and is a former chairman of the illustrious Internet Corporation for Assigned Names and Numbers, the agency governing the Internet address system. Hedge fund manager, VC, and PayPal cofounder Peter Thiel also delivered a keynote, as did multi-prize-winning scientist Bruce Ames, after whom the Ames test for carcinogens is named.
Venture capitalists are now paying close attention to the longevity space. Ester Dyson discussed her interest in an interview with the New York Times. “I’m looking at a lot of companies that are in the formation mode of health and self tracking platforms,” she said in February 2010.40 This helps explain why she was speaking at a life-extension conference organized by Peterson, who is superconnected to individuals in that industry.

…

The point is that biology has become the latest and greatest engineering project, one that hobbyists celebrate. More importantly, eventually this passion will change the world. Those who have already made it big in the technology industry have not failed to notice. Aside from Bill Gates and Jeff Bezos, other tech titans who are driving interest in the longevity meme include Oracle’s Larry Ellison, PayPal cofounder Peter Thiel, Google’s Larry Page and Sergey Brin, and Microsoft cofounder Paul Allen.
TECH TITANS TAKING ON BIOLOGY
“Death has never made any sense to me,” Larry Ellison told investigative reporter Mike Wilson, who wrote an authorized biography of the so-called bad boy of Silicon Valley. “How can a person be there and then just vanish, just not be there?. . . Death makes me very angry. Premature death makes me angrier still.”63 With these sentiments, it’s not surprising that Ellison has devoted a large chunk of his wealth to antiaging research.

People around the world have sent hundreds of billions of dollars to one another over the Web—instantly and safely—thanks to PayPal’s innovative technology. When PayPal went public in 2002 (one of only two companies to do so that year), it gave hope to a technology industry in recession. When eBay acquired the company for $1.5 billion, PayPal staked its claim as a great Silicon Valley success story. Yet the PayPal Plan A did not look anything like the company looks today.
In 1998 programmer Max Levchin teamed with derivatives trader Peter Thiel to create a “digital wallet”—an encryption platform that allowed you to store cash and information securely on your mobile phone. That soon evolved to software that allowed you to send and receive digital cash wirelessly and securely via a Palm Pilot (the first of several iterations) so that two friends could split a dinner tab using their PDAs. It was a neat idea that leveraged Max’s and Peter’s technology and finance backgrounds, respectively (complementary assets that gave them a competitive edge as founders).

…

Amazon, Boeing, UNICEF, and Whole Foods—to pick a handful of companies—are very different organizations, but they are all, ultimately, people organizations. People develop the technologies, write the mission statements, and stand behind the corporate logos and abstractions.
People are the source of key resources, opportunities, information, and the like. For example, my long-term friendship with Peter Thiel, which started in college, is what connected me to PayPal. Without the relationship, Peter never would have called me with the life-changing opportunity. Likewise, without the alliance, I wouldn’t have referred Sean Parker and Mark Zuckerberg to Peter during Facebook’s initial financing. In alliances, resources and assistance flow both ways.
People also act as gatekeepers. Jeffrey Pfeffer, professor of organizational behavior at Stanford, has marshaled evidence that shows that when it comes to getting promoted in your job, strong relationships and being on good terms with your boss can matter more than competence.

…

Our different styles make conversation fun. But it’s our similar interests and vision that have made our collaborations so successful. We invested in Friendster together in 2002, at the dawn of social networking. In 2003 the two of us bought the Six Degrees patent, which covers some of the foundational technology of social networking. Mark then started his own social network, Tribe; I started LinkedIn. When Peter Thiel and I were set to put the first money into Facebook in 2004, I suggested that Mark take half of my investment allocation. As a matter of course, I wanted to involve Mark in any opportunity that seemed intriguing, especially one that played to his social networking background—it’s what you do in an alliance. In 2007, Mark called me to talk about his idea for Zynga, the social gaming company he cofounded and now leads.

Kirkpatrick, “Egyptian Revolt’s Leaders Count Their Mistakes,” New York Times, June 14, 2012, http://www.nytimes.com/2012/06/15/world/middleeast/egyptian-revolts-leaders-count-their-mistakes.html?pagewanted=all.
129 German-born investor Peter Thiel: some of the best reporting on Thiel includes Brian Caulfield and Nicole Perlroth, “Life After Facebook,” Forbes, February 14, 2011, http://www.forbes.com/forbes/2011/0214/features-peter-thiel-social-media-life-after-facebook.html; Jonathan Miles, “The Billionaire King of Techtopia,” Details, September 2011, http://www.details.com/culture-trends/critical-eye/201109/peter-thiel-billionaire -paypal-facebook-internet-success; George Packer, “No Death, No Taxes,” The New Yorker, November 28, 2011, http://www.newyorker.com/reporting/2011/11/28/111128fa_fact_packer; Ashlee Vance and Brad Stone, “Palantir, the War on Terror’s Secret Weapon,” Businessweek, November 22, 2011, http://www.businessweek.com/magazine/palantir-the-vanguard-of-cyberterror-security-11222011.html.
129 a video on Palantir’s YouTube channel: see “Creating Transparency with Palantir,” uploaded July 5, 2012; available at http://www.youtube.com/watch?

…

v=8cbGChfagUA&feature=plcp.
130 “because the first place most of us want to experiment”: Tabatha Southey, “A Billionaire’s Waterworld Takes Libertarianism to New Depths,” Globe and Mail, August 19, 2011, http://www.theglobeandmail.com/commentary/a-billionaires-waterworld-takes-libertarianism-to-new-depths/article548981.
130 “In our time, the great task”: Peter Thiel, “The Education of a Libertarian,” Cato Unbound, April 13, 2009, http://www.cato-unbound.org/2009/04/13/peter-thiel/the-education-of-a-libertarian.
130 “the critical question then becomes”: ibid.
130 “in the late 1990s, the founding vision”: ibid.
130 PayPal revised how it deals: Cyrus Farivar, “PayPal Sets Down Stricter Regulations for File-Sharing Sites,” Ars Technica, July 11, 2012, http://arstechnica.com/business/2012/07/paypal-sets-down-stricter-regulations-for-file-sharing-sites.
131 “when seen through the lens of technology”: Peter H.

…

The former are the technoescapists, who think that technology, exemplified by “the Internet,” can make politics obsolete; the latter are the technorationalists, who think that technology and “the Internet” can shrink what makes politics political and instead boost its technocratic dimension. Both are extremely dangerous.
The best ambassador of the technoescapist camp is German-born investor Peter Thiel, who made his fortune with PayPal and was the first outside investor in Facebook. Thiel cuts a very odd figure: a self-proclaimed libertarian who bankrolled much of Ron Paul’s presidential campaign, he also chairs the board of Palantir, a leader in intelligence-gathering and data-mining solutions that mostly caters to the interests of America’s defense community—a community that devoted libertarians like Paul actually want to dismantle.

. $44.2 Billion,” Safe Haven, October 17, 2012, accessed October 20, 2012, http://www.safehaven.com/article/27361/
us-august-net-trade-deficit-reported-at-us442-billion.
235 Even in high tech: Michael Mandel, “Innovation Failure,” Mandel on Innovation and Growth, October 5, 2010, accessed October 21, 2012, http://innovationandgrowth.wordpress.com/2010/10/05/
innovation-failure/; Michael Mandel, discussions with the author, 2012.
235 A National Science Foundation report: Mark Boroush, “NSF Releases New Statistics on Business Innovation,” October 2010, accessed October 12, 2012, http://www.nsf.gov/statistics/
infbrief/nsf11300/.
235 At an Aspen Institute: TPI Aspen Forum, August 21 to 23, 2011, https://techpolicyinstitute.org/aspen2011/.
235 Peter Thiel, a cofounder: Rip Empson, “Max Levchin and Peter Thiel: Innovation in the World Today Is Between ’Dire Straits and Dead,’” TechCrunch, September 12, 2011, http://techcrunch.com/2011/09/12/
max-levchin-and-peter-thiel-innovation-in-the-world-today-is-between-dire-straits-and-dead/.
235 and we haven’t seen any new breakthroughs in energy: Ken Bossong, “Renewable Energy Provided 11% of Domestic Energy Production in 2010,” Renewable Energy World, accessed September 15, 2012,
http://www.renewableenergyworld.com/rea/news/
article/2011/04/
renewable-energy-provided-11-of-domestic-energy-production-in-2010.
235 We have all been feeling the ripple: Michael Mandel, “Why Isn’t the Innovation Economy Creating More Jobs?”

…

With enough money to do a start-up, Zuckerberg hired Owen Van Natta from Amazon, and Van Natta was instrumental in increasing revenue and building out the company from twenty-six employees to hundreds. Then he fired Van Natta and hired Sheryl Sandberg, a veteran manager from Google, to help him scale Facebook to a global corporation. Along this journey, according to Blodget, Zuckerberg sought counsel from the likes of Peter Thiel, who was an early investor; Marc Andreessen, now a board member; and LinkedIn’s Reid Hoffman.
None of this was easy for Zuckerberg, who was far more comfortable as a software programmer and product designer. But he pushed himself to find people who could teach him a wide variety of communication and business skills, which he used to further his vision. When I saw him in Davos, he was already on his way to shape shifting from computer nerd to high-tech entrepreneur, exuding a confidence in his calling that didn’t exist when he was in school.

…

A National Science Foundation report released in September 2010, called the 2008 Business R&D and Innovation Survey (BRDIS), showed that only 9 percent of public and private companies engaged in either product or service innovation between 2006 and 2008. This is an extraordinary and unexpected fact. Because of the proliferation of cool gadgets like tablets and smart phones, many of us believe we’re living in an era of immense innovation—but we’re not. At an Aspen Institute Conference on technology in 2011, Peter Thiel, a cofounder of PayPal and an early investor in Facebook, said that except for big advances in computer-related areas, innovation has actually “stalled out.” There’s been little innovation in transportation and we haven’t seen any new breakthroughs in energy, with alternatives to hydrocarbons making up just a fraction of all energy production.
We have all been feeling the ripple effects of the innovation shortfall.

Gabriel Baldinucci, Chief Strategy Officer at Singularity University and a former principal at Virgin Group’s U.S. venture arm, has observed that there are two levels of immune responses. The first is to defend the core business because it’s the status quo; the second is to defend yourself as an individual because there’s more ROI for you than for the organization.
What makes traditional companies highly efficient at expansion and growth as long as market conditions remain unchanged is also what makes them extremely vulnerable to disruption. As Peter Thiel said, “Globalization is moving from one to N copying existing products. That was the 20th century. Now in the 21st century we move into a world where zero to one and creating new products will increasingly be a priority for companies due to the rise of different exponential technologies.”
Whatever else they may be, big companies aren’t stupid. They know about this structural weakness and many are striving to fix it.

…

A quick but relevant side note here: We strongly recommend reading The Lean Startup by Eric Ries as an accompaniment to this chapter, since we’ll be referring to it frequently. In fact, the best definition we’ve found for a startup comes from Ries: “A startup is a human institution designed to deliver a new product or service under conditions of extreme uncertainty.” A second book we recommend is Peter Thiel and Blake Masters’ recent publication, Zero to One: Notes on Startups or How to Build the Future.
This is perhaps the best time in the history of business to build a new enterprise. The confluence of breakthrough technologies, acceptance (and even celebration) of entrepreneurship, different crowdsourcing options, crowdfunding opportunities and legacy markets ripe for disruption—all create a compelling (and unprecedented) scenario for new company creation.

…

Finding an MTP can be seen as a novel and perhaps more interesting way of asking yourself the following questions:
What do I really care about?
What am I meant to do?
Two more questions that can help speed the process of discovering your passion:
What would I do if I could never fail?
What would I do if I received a billion dollars today?
It is not only about you as an entrepreneur, however. It is also about your employees. PayPal co-founder Peter Thiel poses the following question as an effective way to test if a startup has an MTP that will attract not only friends, but also employees beyond your personal network who share your motivation: “Why would the 20th employee join your startup without the perks, [such as] a co-founder title or stock [options]?”
Accordingly, you should gauge your MTP against each of the acronym’s letters. Is it Massive?

When entrepreneurs wait for the market to cool down, they have higher odds of success: “Nonconformists . . . that buck the trend are most likely to stay in the market, receive funding, and ultimately go public.”
Third, along with being less recklessly ambitious, settlers can improve upon competitors’ technology to make products better. When you’re the first to market, you have to make all the mistakes yourself. Meanwhile, settlers can watch and learn from your errors. “Moving first is a tactic, not a goal,” Peter Thiel writes in Zero to One; “being the first mover doesn’t do you any good if someone else comes along and unseats you.”
Fourth, whereas pioneers tend to get stuck in their early offerings, settlers can observe market changes and shifting consumer tastes and adjust accordingly. In a study of the U.S. automobile industry over nearly a century, pioneers had lower survival rates because they struggled to establish legitimacy, developed routines that didn’t fit the market, and became obsolete as consumer needs clarified.

…

With a proof of concept, but no working prototype, she had a chicken-and-egg problem: she needed funding to build a prototype, but her idea was so radical that investors wanted to see a prototype first. As the solo founder of a technology startup, with no engineering background, she needed allies to move forward.
Three years later, I met Perry at a Google event. After landing $750,000 in seed money from Mark Cuban, Marissa Mayer, and Peter Thiel’s Founders Fund, her team had just finished its first functional prototype. It could power devices faster than a wire, at longer distances, and would be ready for consumers in two years. By the end of 2014, her company, uBeam, had accumulated eighteen patents and $10 million in venture funding.
Perry took her place onstage in a lineup that included Snoop Dogg, a Nobel Prize winner, and former President Bill Clinton.

(and other entrepreneurial questions)20
Drew Houston, founder of the online storage service Dropbox, thinks all would-be entrepreneurs should try to answer the above question. “The most successful people are obsessed with solving an important problem, something that matters to them,” according to Houston. “They remind me of a dog chasing a tennis ball.” To enhance your prospects, “find your tennis ball—the thing that pulls you.” PayPal cofounder Peter Thiel believes entrepreneurs can find ideas to pursue by asking themselves, What is something I believe that nearly no one agrees with me on? If self-examination doesn’t work, try looking around: Brian Spaly, a serial entrepreneur in the apparel industry, advises, “Whenever you encounter a service or customer experience that frustrates you, ask, Is this a problem I could solve?” Lastly, don’t just focus on the mercenary question Will consumers pay for this?

…

, (Coca Cola’s “unbeautiful” question)
What if I peel off the skin and cut them into perfect mini-carrots?
What if we marketed baby carrots like junk food?
Do we want to take a shortcut on this, or do it right?
What are we against?
What if we asked people not to buy from us?
How can we make a better experiment?, (Eric Ries’ central question)
What is your tennis ball?, (Dropbox’s Drew Houston)
What is something I believe that nearly no one agrees with me on?, (Peter Thiel’s question for startups)
Is this a problem I could solve?
Will this make people’s lives meaningfully better?
How do companies get better at experimenting?
What will we learn?
What is our Petri dish?
Where in the company is it safe to ask radical questions?
Where, within the company, can you explore heretical questions that could threaten the business as it is—without contaminating what you’re doing now?

pages: 357words: 94,852

No Is Not Enough: Resisting Trump’s Shock Politics and Winning the World We Need
by
Naomi Klein

If you think “combat training” is something armies used to do all on their own, you’d be right.
One noticeable thing about Trump’s contractor appointees is how many of them come from firms that did not even exist before 9/11: L1 Identity Solutions (specializing in biometrics), the Chertoff Group (founded by Bush’s Homeland Security director Michael Chertoff), Palantir Technologies (a surveillance/big data firm cofounded by PayPal billionaire and Trump backer Peter Thiel), and many more. Security firms draw heavily on the military and intelligence wings of government for their staffing. Under Trump, a remarkable number of lobbyists and staffers from these firms are now migrating back to government, where they will very likely push for even more opportunities to monetize the hunt for people President Trump likes to call “bad hombres.”
This creates a disastrous cocktail.

…

Evan Osnos recently reported in the New Yorker that, in Silicon Valley and on Wall Street, the more serious high-end survivalists are hedging against climate disruption and social collapse by buying space in custom-built underground bunkers in Kansas (protected by heavily armed mercenaries) and building escape homes on high ground in New Zealand. It goes without saying that you need your own private jet to get there—the ultimate Green Zone.
At the ultra-extreme end of this trend is PayPal billionaire Peter Thiel, a major Trump donor and member of his transition team. Thiel underwrote an initiative called the Seasteading Institute, cofounded by Patri Friedman (grandson of Milton) in 2008. The goal of Seasteading is for wealthy people to eventually secede into fully independent nation-states, floating in the open ocean—protected from sea-level rise and fully self-sufficient. Anybody who doesn’t like being taxed or regulated will simply be able to, as the movement’s manifesto states, “vote with your boat.”

Newman, “Power Laws, Pareto Distributions and Zipf’s Law,” Contemporary Physics 46 (2005): 323–51.
35.Patricia Cohen, “Richest 1% Likely to Control Half of Global by Wealth by 2016, Study Finds,” New York Times, January 19, 2015.
36.Taleb wrote that “In Extremistan, inequalities are such that one single observation can disproportionately impact the aggregate, or the total.” See Nassim Nicholas Taleb, The Black Swan: The Impact of the Highly Improbable (New York: Random House, 2007), 33.
37.Peter Thiel, Zero to One: Notes on Startups, or How to Build the Future (New York: Crown Business, 2014), 86.
38.Julianne Pepitone and Stacy Cowley, “Facebook’s First Big Investor, Peter Thiel, Cashes Out,” CNNMoney, August 20, 2012.
39.In the introduction to their book of interviews with 35 top VCs and angel investors (including Maples), Tarang Shah and Sheetal Shah observe that entrepreneurs who had founded successful companies “had a very strong intuition and access to asymmetric information” that enabled them to tap emerging opportunities.

…

Andreessen and partner Ben Horowitz picked up much of their investment philosophy, probably including this idea, from investment advisor Andy Rachleff, a former partner at Benchmark Capital and founder of Wealthfront, a firm that uses technology to transform the investment advisory business.29 Rachleff, in turn, credits his “investment idol,” Howard Marks, with this framework.30 When the entrepreneur-turned-VC Peter Thiel asks, “What important truth do very few people agree with you on?” he is getting at the same sort of exceptionalism: the contrarian truth, something that is nonconsensus and right.
Understanding that the biggest returns will come from nonconsensus ideas is only a first step, though, because it is very hard to figure out the “right” part. Consider Twitter, which Maples invested in before founding Floodgate.

…

For example, according to a study released today, the 80 wealthiest individuals in the world collectively own $1.9 trillion—a total about equal to the “wealth” of all the people in the poorer half of the world.35 In The Black Swan, Taleb coined a memorable word to refer to such highly skewed distributions: they occur in “Extremistan,” where a single event or data point has a disproportionate impact on the total.36 Venture capital lives in Extremistan in that only about 15 start-ups out of several thousand vying for VC funding each year are responsible for the vast majority of profits: just one of those megahits—the next Google or Facebook or Twitter—will make you a monumental winner even if all your other investments lose money. Peter Thiel calls this “the biggest secret in venture capital,” writing in Zero to One. “The best investment in a successful fund equals or outperforms the entire rest of the fund combined.”37 Thiel’s $500,000 angel investment in Facebook in 2004 (before he became a VC) came to be worth more than $1 billion when Facebook went public in 2012,38 making it easier for him to take the kind of radical bets that we associate with eccentric billionaires.

.: Work and Memory in Youngstown (Lawrence: University Press of Kansas, 2002).
John Russo, “Integrated Production or Systematic Disinvestment: The Restructuring of Packard Electric” (unpublished paper, 1994).
Sean Safford, Why the Garden Club Couldn’t Save Youngstown: The Transformation of the Rust Belt (Cambridge, MA: Harvard University Press, 2009).
PETER THIEL AND SILICON VALLEY
Sonia Arrison, 100 Plus: How the Coming Age of Longevity Will Change Everything, from Careers and Relationships to Family and Faith, with a foreword by Peter Thiel (New York: Basic Books, 2011).
Eric M. Jackson, The PayPal Wars: Battles with eBay, the Media, the Mafia and the Rest of Planet Earth (Los Angeles: World Ahead Publishing, 2010).
David Kirkpatrick, The Facebook Effect: The Inside Story of the Company That Is Connecting the World (New York: Simon & Schuster, 2011).

…

To get things running, he looked around for a number two—someone who knew how to make his boss look good. His eye fell on Connaughton.
Clinton had banned top officials who left the administration from contacting the federal government for five years. The rule applied to Quinn but not to Connaughton, who wasn’t senior enough. So, at the age of thirty-seven, he joined Arnold & Porter and launched a new career: as a lobbyist.
SILICON VALLEY
Peter Thiel was three years old when he found out that he was going to die. It was in 1971, and he was sitting on a rug in his family’s apartment in Cleveland. Peter asked his father, “Where did the rug come from?”
“It came from a cow,” his father said.
They were speaking German, Peter’s first language—the Thiels were from Germany, Peter had been born in Frankfurt.
“What happened to the cow?”
“The cow died.”

…

The best students went on to Berkeley, Davis, or UCLA (a few made it to Stanford or the Ivies), the average ones went to San Francisco State or Chico State, and the burnouts and heads could always get a two-year degree at Foothill or De Anza. The tax revolt—Proposition 13, a referendum that would limit property taxes in California to 1 percent of assessed value, sending the state’s public schools into a long decline—was still a year away.
Peter Thiel moved to the Valley in the last year of its middle-class heyday. Everything was about to change, including the name.
After Swakopmund, Foster City in the school year of Saturday Night Fever seemed riotous and decadent. A lot of the kids had divorced parents. In Peter’s fifth-grade classroom, the teacher was a long-term substitute who lost all control. Kids stood on their desks and yelled at one another and the teacher.

Acceleration Versus Stagnation
As information and communications technologies have advanced in their decades-long exponential march, innovation in other areas has been largely incremental. Examples include the basic design of cars, homes, aircraft, kitchen appliances, and our overall transportation and energy infrastructures, none of which, for the most part, have changed significantly since the middle of the twentieth century. PayPal co-founder Peter Thiel’s famous comment—“We were promised flying cars, and instead what we got was 140 characters”—captures the sentiment of a generation that expected the future to be way cooler than this.
This lack of broad-based progress stands in stark contrast to what a person who lived through the final decades of the nineteenth century and the first half of the twentieth would have experienced. Indoor plumbing, automobiles, airplanes, electricity, home appliances, and public sanitation and utility systems all came into widespread use during this period.

…

Robert Geraci, a professor of religious studies at Manhattan College, wrote in an essay entitled “The Cult of Kurzweil” that if the movement achieves traction with the broader public, it “will present a serious challenge to traditional religious communities, whose own promises of salvation may appear weak in comparison.”7 Kurzweil, for his part, vociferously denies any religious connotation and argues that his predictions are based on a solid, scientific analysis of historical data.
The whole concept might be easy to dismiss completely were it not for the fact that an entire pantheon of Silicon Valley billionaires have demonstrated a very strong interest in the Singularity. Both Larry Page and Sergey Brin of Google and PayPal co-founder (and Facebook investor) Peter Thiel have associated themselves with the subject. Bill Gates has likewise lauded Kurzweil’s ability to predict the future of artificial intelligence. In December 2012 Google hired Kurzweil to direct its efforts in advanced artificial intelligence research, and in 2013 Google spun off a new biotechnology venture named Calico. The new company’s stated objective is to conduct research focused on curing aging and extending the human lifespan.

Inspired by the early experiences of companies like AOL and Amazon, high-tech entrepreneurs and their cheerleaders in the media decided that the key to long-term success was growth at all costs—and many of them burned through millions of dollars in pursuit of that growth. Countless ambitious nerds in their twenties and early thirties were amassing giant fortunes—on paper, at least.
In this tumultuous atmosphere, a pair of young entrepreneurs entered the exploding Internet arena. Thirty-one-year-old Peter Thiel was born in Germany and raised in California, where he became one of the country’s highest-ranked young chess players and went on to study philosophy and law at Stanford University. An avowed libertarian, Thiel helped found the Stanford Review, a conservative newspaper that challenged the university’s dominant liberal culture.
Max Levchin, twenty-three years old, was born in Ukraine and granted political asylum when he moved to the U.S. with his family.

…

This simplicity was in stark contrast to previous online payment mechanisms, which demanded multiple rounds of verification before an account could be set up, thereby discouraging early users. PayPal’s user-friendly, almost frictionless system attracted a significant initial base of consumers—though not enough, in itself, to make the platform attractive to the universe of online sellers.
In a lecture he later gave at Stanford, Peter Thiel explained what happened next:
PayPal’s big challenge was to get new customers. They tried advertising. It was too expensive. They tried BD [business development] deals with big banks. Bureaucratic hilarity ensued. … the PayPal team reached an important conclusion: BD didn’t work. They needed organic, viral growth. They needed to give people money.
So that’s what they did. New customers got $10 for signing up, and existing ones got $10 for referrals.

In regard to how the world adjusts to China, I think the economic adjustment will be easier than perhaps some of the political issues.As they become
more powerful, there are various potential flashpoints and a lot of potential
for friction, especially as they become more and more self-assertive, which I
think they will.
In Japan, things have clearly looked up, but they have stored up such
huge problems. Perhaps what you’re going to have is a lot of inflation in
Japan, which may be the only way they’ll come out of this mess.
CHAPTER 9
The Dot-Commer
Peter Thiel
Former CEO and Cofounder of PayPal
Clarium Capital
San Francisco
eter Thiel is bit of an enigma in global macro.Whereas some managers
earn distinction because they are successful and secretive, Thiel is unusually open about all things related to his business, Clarium Capital Management, a San Francisco–based global macro hedge fund. Since its launch
in October 2002, initial investors have more than tripled their money and
fund assets are now well over $1 billion.

See, for example, “The Sharing Economy Is Not as Open as You Might Think,” The Guardian, November 12, 2014. A post titled “Can the Sharing Economy End Discrimination?” on the website of tech magazine Wired took the opposite view, albeit without providing any evidence in support of the argument. For a broader critique of the sharing economy, see Tom Slee, What’s Yours Is Mine (London: OR Books, 2015).
12. Peter Thiel, “Competition Is for Losers,” Wall Street Journal, September 12, 2014, http://www.wsj.com/articles/peter-thiel-competition-is-for-losers-1410535536.
Chapter 9. How Markets Shape Us
1. Despite its fearsome reputation, Changi was among the better-run Japanese camps, with only 850 deaths among the 87,000 prisoners who passed through.
2. On Changi as heaven compared to other camps: Kevin Blackburn, “Commemorating and Commodifying the Prisoner of War Experience in South-east Asia: The Creation of Changi Prison Museum,” Journal of the Australian War Memorial 33 (2000), http://www.awm.gov.au/journal/j33/blackburn.asp.
3.

…

Although proponents of the sharing economy tout its ability to reduce market frictions, the only way they’re going to make the kinds of profits they (and their investors) want is to create new ones. That’s something they’re not interested in talking about to the public at large, or to their representatives in government.
This leaves a bit of a paradox in the techno-utopian free-market narrative. A great entrepreneur will use technology to create a fantastic new market, then will use technology to set up market frictions to protect it. As entrepreneur and venture capitalist Peter Thiel wrote in the Wall Street Journal, “Competition Is for Losers.”12
Don’t get us wrong. We’re not faulting the market makers of Silicon Valley nor begrudging them for the profits they’ve generated and captured. But we are trying to point out some of the inconsistencies between the claims of pristine competition espoused by free-market zealots in general and the practicalities of making markets work.

The first set involves finding the right models and techniques to
interpret and work with incredibly noisy, high-throughput neural data. The other set
of problems involves bridging the gap between the scientists running the experiments and those creating the mathematical models.
While Jonas has been continuously fascinated with the brain since he was seven
years old, he has alternated brain science with entrepreneurship. He co-founded two
start-ups, both of which were backed by Peter Thiel’s venture capital firm, Founders
Fund. The first, Navia Systems, developed a new class of probabilistic computers to
make inferences under uncertainty. He was CEO of the second, Prior Knowledge,
which created a predictive database that learned the deep structure of the data it
contained, and then used that knowledge to generate predictions based on probabilistic inference. Just three months after being featured as a TechCrunch Disrupt
Finalist, Prior Knowledge was acquired by Salesforce.com.

…

It is important to ask whether you can
trust this answer or not, especially since often whether or not you can trust
an answer varies greatly on the question you happen to be asking. Machine
learning systems will quite reliably tell you that there are two genders, male
and female, but they won’t always be accurate in predicting which one you’re
talking to. So that was really the goal.
We did the normal startup thing—we built the product, we demoed and made
it to the finals at TechCrunch Disrupt, and we raised funding from venture
capital firms. Peter Thiel’s group, Founders Fund, backed us. We then were
acquired in December of 2012 by Salesforce, where we found a great team
of people who very closely agreed with the vision of a ubiquitous predictive
platform, where at the end of the day saying “predict” should be as easy as
saying “select.” I was at Salesforce for over a year, where my team and I
continued to work on machine learning technology.

The responsibility for fixing problems enabled by the perfect investment lies with those sorry souls who are fated to act and take risks in the disadvantaged neighborhood that is reality.
The perfect investment will quickly anneal into an impermeable and unchallengeable position, by nature a monopoly in its domain. Competition in a traditional sense might appear, but it will never achieve more than a token status. (I use the term monopoly here not in the legal sense, as in antitrust law, but in the vernacular Silicon Valley sense. For instance, Peter Thiel, founder of PayPal and a foundational investor in Facebook, taught students in his Stanford course on startups to find a way to create “monopolies.”)
Candy
The primary business of digital networking has come to be the creation of ultrasecret mega-dossiers about what others are doing, and using this information to concentrate money and power. It doesn’t matter whether the concentration is called a social network, an insurance company, a derivatives fund, a search engine, or an online store.

…

It means something to have a PhD from someplace like MIT. We love those places! There are legendary professors and we scramble to recruit their graduating students.
But it’s also considered the height of hipness to eschew a traditional degree and unequivocally prove yourself through other means. The list of top company runners who dropped out of college is commanding: Bill Gates, Steve Jobs, Steve Wozniak, and Mark Zuckerberg, for a start. Peter Thiel, of Facebook and PayPal fame, started a fund to pay top students to drop out of school, since the task of building high-tech startups should not be delayed.
Mea culpa. I never earned a real degree (though I have received honorary ones). In my case poverty played a role, as it did for many others. But also, the very thought of slogging through someone else’s procedures to gain abstract approval seemed unacceptably retro and irrelevant.

…

This is the sort of fantasy that drives many—and I would actually guess most—successful young entrepreneurs and engineers in Silicon Valley these days. The idea is that the amazing lift you get from starting a ’net-based business that can become huge in just a few years is the fore-echo of something far more profound that you will be able to achieve almost as quickly. Soon technological prowess will make the cleverest hackers not only immortal but immortal superheroes.
Earlier, I noted that Peter Thiel, founder of PayPal and an investor in Facebook, teaches a class at Stanford in which he advocates that students not think in terms of competing in a marketplace, but in terms of defining a position they can “monopolize.” This is precisely the idea of the Siren Server. It is a given that in Silicon Valley no one wants to suffer the indignity of sharing a market with competitors.
It is the correlate that must be understood.

CHAPTER 16
167Some $1.2 million worth of Bitcoin: Nicolas Christin, “Traveling the Silk Road: A Measurement Analysis of a Large Anonymous Online Marketplace,” Working Paper, November 28, 2012.
167seventy thousand different topics on Silk Road’s forum: Eileen Ormsby, Silk Road (Sydney: Pan Macmillan Australia, 2014).
168His work on Silk Road was done at an Internet café around the corner: Sealed complaint against Ross Ulbricht filed by FBI Special Agent Christopher Tarbell, September 27, 2013.
168Over the summer, a Silk Road user had managed to follow a series of transactions: Ormsby.
169paying the attacker $25,000: RUTE GX 250.
169Ross explained that he was changing his writing style: Ormsby.
169In November, Ross flew to Dominica: RUTE GX 291.
169“put yourself in the shoes of a prosecutor”: RUTE GX 225B.
170Ross decided to help nob sell his kilogram: Superseding indictment against Ross Ulbricht filed by the Grand Jury for the District of Maryland, October 1, 2013.
171Ross had always been somewhat skeptical: RUTE GX240B.
171“beat up, then forced to send the Bitcoins he stole back”: Superseding indictment against Ross Ulbricht filed by the Grand Jury for the District of Maryland, October 1, 2013. Ross has not yet been tried on the charges in the Maryland indictment and has not been found guilty on any counts related to murder.
CHAPTER 18
186“PayPal will give citizens worldwide more”: Eric Jackson, PayPal Wars (Washington, DC: WND Books, 2004).
187Thiel advocating for floating structures: “Peter Thiel Offers $100,000 in Matching Donations to TSI, Makes Grant of $250,000,” Sea-steading Institute, February 10, 2010, http://www.seasteading. org/2010/02/peter-thiel-offers-100000-matching-donations-tsi-makes-grant-250000/.
187aiming for the colonization of Mars: Adam Mann, “Elon Musk Wants to Build 80,000-Person Mars Colony,” Wired, November 26, 2012, http://www.wired.com/2012/11/elon-musk-mars-colony/.
CHAPTER 19
190In June 2012 the founders announced: BFL (Butterfly Labs) to BTCF, June 16, 2012.
190a young Chinese immigrant in New York, Yifu Guo, announced: ngzhang to BTCF, September 17, 2012.
191that power doubled again in just one month after Yifu’s machines: Historical data on the hashing power available at https://blockchain.info/charts/hash-rate.
195“This is a dark day for Bitcoin”: “Breaking: The Blockchain Has Forked,” Bitcoin Trader, March 11, 2013, http://www.thebitcointrader .com/2013/03/breaking-blockchain-has-forked.html.
196“clarify the applicability of the regulations implementing”: The FinCen guidance is available at http://fincen.gov/statutes_regs/guidance/html/FIN-2013-G001.html.

…

Much of this skepticism had the same root as the excitement, and that was Silicon Valley’s defining, and cautionary, experience with financial technology: PayPal.
PayPal, of course, still existed, owned by eBay and run by Wences’s friend David Marcus. But what made people wary was not the current incarnation of PayPal, but instead the company’s early days, when it had ambitions to be something much bigger.
PayPal had been founded back in 1998 by Peter Thiel and Max Levchin, among others. Thiel was an avid libertarian, who had wanted to use Levchin’s cryptographic expertise to fulfill the Cypherpunks’ dream of sending money through encrypted channels, between private individuals and in particular between mobile devices like the PalmPilots of that time. In early staff meetings, Thiel gave speeches that could almost have come from the Cypherpunk mailing list.

…

This was a simple enough proposition, and the price of Bitcoin was rising fast enough that it attracted interest from venture capitalists who were still queasy about tying their firms to Bitcoin. Both of the founders of Andreessen Horowitz, Marc Andreessen and Ben Horowitz, signed up to put some of their own personal money into Balaji’s project, as did several of the original founders of PayPal, including Peter Thiel and David Sacks. Soon enough, Balaji was closing in on a $5 million fund-raising round.
The Bitcoin arms race had begun.
THE TYPE OF chip was not the only thing about Bitcoin mining that had changed since late 2010. Over the course of 2011 and 2012, more and more users were joining collectives that pooled their mining power. These mining pools allowed lots of people to combine their resources, with each person getting a proportional fraction of the total winnings, thus increasing the chances that everyone would get something every day.

Google, remember, is a company that plans to organize all of the world’s information; its ambitions could not be greater. It also employs Ray Kurzweil, the chief promoter of the Singularity, a belief that machines will soon become self-aware, or that we will somehow combine with them, or upgrade our brains to the cloud—something amazing, we just don’t know what yet. In short, this is an industry in which such far-fetched thinking is de rigueur. Some of these people actually believe they will live forever. Peter Thiel, a PayPal cofounder and major early investor in Facebook (and another Rand disciple), has derided the inevitability of death as an “ideology” while plowing millions into companies that might, as he said, “cure aging.” Google’s own forays into life-extension research, through a biotech subsidiary called Calico, reflects its belief that it can solve death—at least for a paying few.
So how does social media fit into these dreams of emancipatory digital technology?

…

An important part of identity, as it’s long been understood, is that we act differently in different situations. We put on different roles, we code-switch. We might speak differently with our parents than we would with our children or a coworker or someone we’re flirting with at a bar. At the risk of slipping into something hazily postmodern, there is no single “self.” But don’t tell that to Peter Thiel. The Facebook investor has said that Myspace was “about being someone fake on the Internet; everyone could be a movie star.” With Myspace’s demise and Facebook’s subsequent ascension, Thiel told a reporter, “The real people have won out over the fake people.”
Social-media companies have worked hard to equate authenticity with being “real,” and having a single identity, a single log-in associated with your real name and all of your social-media accounts, with being a safe and good citizen of the social web.

…

This mission is important because connectivity is, in Zuckerberg’s words, “a human right.” Former Facebook employee and venture capitalist Chamath Palihapitiya agrees, telling an interviewer: “Companies are transcending power now. We are becoming the eminent vehicles for change and influence, and capital structures that matter.” (Palihapitiya is also a supporter of FWD.us, Zuckerberg’s political lobbying organization.) Others, such as libertarian PayPal cofounder Peter Thiel, would like to do away with government entirely; he has donated nearly $2 million to the Seasteading Institute, which hopes to build floating cities unencumbered by the trappings of government. Balaji Srinivasan, an entrepreneur and founder of a genetic-testing start-up, has called for “Silicon Valley’s ultimate exit” from “the paper belt,” his term for traditional sovereign governments. A number of other tech leaders agree, with some even calling for the breakup of California into several smaller states.

Fox has a lot of company. He points to science fiction writer Neal Stephenson, who worries that the internet, far from spurring a great burst of industrial creativity, may have put innovation “on hold for a generation.” Fox also cites economist Tyler Cowen, who has argued that, recent techno-enthusiasm aside, we’re living in a time of innovation stagnation.
He might also have mentioned tech powerbroker Peter Thiel, who believes that large-scale innovation has gone dormant and that we’ve entered a technological “desert.” Thiel blames the hippies. “Men reached the moon in July 1969,” he wrote in “The End of the Future,” a 2011 National Review article, “and Woodstock began three weeks later. With the benefit of hindsight, we can see that this was when the hippies took over the country, and when the true cultural war over Progress was lost.”

…

I think as technologists we should have some safe places where we can try out some new things and figure out: What is the effect on society? What’s the effect on people? Without having to deploy it into the normal world. And people who like those kinds of things can go there and experience that.
It’s not only Page. Jeff Bezos and Elon Musk dream of establishing Learyesque space colonies, celestial Burning Mans. Peter Thiel is slightly more down to earth. His Seasteading Institute hopes to set up floating technology incubation camps on the ocean, outside national boundaries. “If you can start a new business, why can you not start a new country?” he asks. In a speech last fall at the Y Combinator Startup School, venture capitalist Balaji Srinivasan channeled Leary when he called for “Silicon Valley’s Ultimate Exit”—the establishment of a new country beyond the reach of the U.S. government and other allegedly failed states.

…

It particularly suits the interests of those who have become extraordinarily wealthy through the labor-saving, profit-concentrating effects of automated systems and the computers that control them. It provides our new plutocrats with a heroic narrative in which they play starring roles: Recent job losses may be unfortunate, but they’re a necessary evil on the path to the human race’s eventual emancipation by the computerized slaves that our benevolent enterprises are creating. Peter Thiel, a successful entrepreneur and investor who has become one of Silicon Valley’s most prominent thinkers, grants that “a robotics revolution would basically have the effect of people losing their jobs.” But, he hastens to add, “it would have the benefit of freeing people up to do many other things.” Being freed up sounds a lot more pleasant than being fired.
There’s a callousness to such grandiose futurism.

For the one-in-three-Internet-users figure, see Patrick Thibodeau, “Amazon Cloud Accessed Daily by a Third of All ’Net Users,” Computerworld.com, April 18, 2012, http://www.computerworld.com/s/article/9226349/Amazon_cloud_accessed_daily_by_a_third_of_all_Net_users. On Apple’s valuation see Susanna Kim, “Apple Is World’s Most Valuable Company Again,” ABCNews.com, January 25, 2012, http://abcnews.go.com/blogs/business/2012/01/apple-is-worlds-most-valuable-company-again/.
30. David Brooks, “The Creative Monopoly,” New York Times, April 24, 2012, A23; and Ryan Mac, “Ten Lessons from Peter Thiel’s Class on Startups,” Forbes.com, June 7, 2012, http://www.forbes.com/sites/ryanmac/2012/06/07/ten-lessons-from-peter-thiels-class-on-startups/.
31. Slavoj Zizek describes this issue succinctly in his essay “Corporate Rule of Cyberspace,” InsideHigherEd.com, May 2, 2011, http://www.insidehighered.com/views/2011/05/02/slavoj_zizek_essay_on_cloud_computing_and_privacy.
32. One predictable consequence of Amazon’s rapid expansion has been the further consolidation of the book business.

…

Monopolies, contrary to early expectations, prosper online, where winner-take-all markets emerge partly as a consequence of Metcalfe’s law, which says that the value of a network increases exponentially by the number of connections or users: the more people have telephones or have social media profiles or use a search engine, the more valuable those services become. (Counterintuitively, given his outspoken libertarian views, PayPal founder and first Facebook investor Peter Thiel has declared competition overrated and praised monopolies for improving margins.30) What’s more, many of the emerging info-monopolies now dabble in hardware, software, and content, building their businesses at every possible level, vertically integrating as in the analog era.
This is the contradiction at the center of the new information system: the more customized and user friendly our computers and mobile devices are, the more connected we are to an extensive and opaque circuit of machines that coordinate and keep tabs on our activities; everything is accessible and individualized, but only through companies that control the network from the bottom up.31 Amazon strives to control both the bookshelf and the book and everything in between.

But this is not the right strategy when it comes to finding the channels for marketing and distributing your product (which in Web business are often one and the same). Marketers commonly make the mistake of believing that diversifying efforts across a wide variety of channels is best for growth. As a result, they spread resources too thin and don’t focus enough on optimizing one or a couple of the channels likely to be most effective. Most often it’s better, as Google founder and CEO Larry Page has said, to put “more wood behind fewer arrows.” Or as Peter Thiel, cofounder of PayPal, Palantir, and the first outside investor in Facebook, tells start-up founders, “It is very likely that one channel is optimal. Most businesses actually get zero distribution channels to work. Poor distribution—not product—is the number one cause of failure. If you can get even a single distribution channel to work, you have great business. If you try for several but don’t nail one, you’re finished.”12
At the same time, too many companies get caught in the trap of following the herd, using the same channels as everyone else, such as Google paid ads or Facebook advertising, and not experimenting with options that might be more effective for their specific product, and less expensive.

According to the New Scientist “The annual KSI, or average number of cyclists killed or seriously injured, between 1994 and 1998 was 567, compared with 515 per year from 2008 to 2012. That’s a fall of nine per cent. At the same time, there has been a huge rise in the number of people getting on their bikes – 176 per cent more since 2000.”17 But the significant danger of at least serious injury must be a discouragement to many potential cyclists.
Clothing
According to Business Insider, Peter Thiel, founder of PayPal and one of Silicon Valley’s key venture capitalists, “hates suits”. While he cautions that there are “no absolute and timeless sartorial rules,” Thiel says that, “in Silicon Valley, wearing a suit in a pitch meeting makes you look like someone who is bad at sales and worse at tech.” Maybe that’s why he has a simple rule for investing: never bet on a CEO in a suit. Thiel says that this rule has helped him avoid making poor bets on slick business folk compensating for crap products with well-dressed charm.

You can always get bandwidth by declaring yourself a utopian; and you can always get bandwidth by mourning the downward trend lines for some pressing social issue—however modest the trend itself may be. But declaring that things are slightly better than they were a year ago, as they have been for most years since at least the dawn of industrialization, almost never makes the front page.
Consider this observation from the entrepreneur and investor Peter Thiel, published in National Review:
When tracked against the admittedly lofty hopes of the 1950s and 1960s, technological progress has fallen short in many domains. Consider the most literal instance of non-acceleration: We are no longer moving faster. The centuries-long acceleration of travel speeds—from ever-faster sailing ships in the 16th through 18th centuries, to the advent of ever-faster railroads in the 19th century, and ever-faster cars and airplanes in the 20th century—reversed with the decommissioning of the Concorde in 2003, to say nothing of the nightmarish delays caused by strikingly low-tech post-9/11 airport-security systems.

…

PROGRESS, ACTUALLY
The article on airline safety, “Airlines Go Two Years with No Fatalities,” appeared in the January 12, 2009, edition of USA Today. My original post on air safety and subsequent coverage of the US Airways crash ran on the website BoingBoing; the first post can be found at http://boingboing.net/2009/01/14/for-once-news-about.html. William Langewiesche’s Fly by Wire: The Geese, the Glide, the Miracle on the Hudson gives a thorough account of the Airbus 320 design and its role in the Hudson landing. Peter Thiel’s “The End of the Future” appeared in the October 3, 2011, issue of National Review.
High school dropout rates and college enrollment: Between 1988 and 2008, the high school dropout rate for the United States declined from 14.6 to 9.3. (Source: “Trends in High School Dropout and Completion Rates in the United States: 1972–2008”; http://nces.ed.gov/pubs2011/2011012.pdf.) During that same period, college enrollment increased from 30.3 to 39.6 percent.

But the growth vanished almost as quickly as it came. We are still awaiting the productivity gains we were assured would result from the digital economy. With the exception of most of the 1990s, productivity growth has never recaptured the rates it achieved in the post-war decades. ‘You can see the computer age everywhere but in the productivity statistics,’ said Robert Solow, the Nobel Prize-winning economist. Peter Thiel, the Silicon Valley billionaire, who has controversially backed Donald Trump, put it more vividly: ‘We wanted flying cars, instead we got 140 characters [Twitter].’ That may be about to change, with the acceleration of the robot revolution and the spread of artificial intelligence. But we should be careful what we wish for. The squeeze is already uncomfortable enough.
I am nearing fifty. My generation – those born in the mid-to-late 1960s and the 1970s – straddled the transition from the golden years to the new normal, though we did not wake up to it until we were into our thirties.

…

It is ­possible to imagine we can pull together to ensure that everyone will have a stake in a hyper-automated future. But there are gaping holes in this pleasant reverie. The digital revolution is still in its infancy, yet we are already throwing our toys out of the pram. As political societies, we are further away from plausible solutions than when the digital revolution began. Unlike the Industrial Revolution, it is taking place in a hyper-democratic world. Peter Thiel was right, of course; Twitter cannot be compared to the invention of printing, or flying cars. Yet he was also wrong. We live in a world where everyone with a grievance wields more digital power in the palm of their hand than the computers that sent Apollo 14 into orbit. The Industrial Revolution was unleashed on undemocratic – or in the case of Britain and the US, semi-democratic – societies.

Demand doesn’t exist in a vacuum, after all; it’s the product of a constant negotiation, determined by a country’s laws and institutions, and, of course, by the people who control the purse strings.
Maybe this is also a clue as to why the innovations of the past 30 years – a time of spiraling inequality – haven’t quite lived up to our expectations. “We wanted flying cars, instead we got 140 characters,” mocks Peter Thiel, Silicon Valley’s resident intellectual.16 If the post-war era gave us fabulous inventions like the washing machine, the refrigerator, the space shuttle, and the pill, lately it’s been slightly improved iterations of the same phone we bought a couple years ago.
In fact, it has become increasingly profitable not to innovate. Imagine just how much progress we’ve missed out on because thousands of bright minds have frittered away their time dreaming up hypercomplex financial products that are ultimately only destructive.

A 2011 Pew study finds the broad American public increasingly wary of the cost of college and the value of higher education.10 Parents still expect their kids to go to college, but they’re sure it’s overpriced and not certain their children will get a good education. In a particularly stunning finding, only 19% of college and university presidents think that the American college system is the best in the world.11 Our college and university presidents don’t think our system is exceptional, and many of them think it is getting worse.
One prominent tech entrepreneur, Peter Thiel, finds higher education so much of a dead-end that he has offered to pay promising smart high school kids not to attend college. Thiel cofounded the online payment juggernaut PayPal and was an early investor and mentor for two Silicon Valley heavyweights, Facebook and Palantir. Each year, he picks twenty people under twenty years old and gives them $100,000 to stay out of school for two years and focus on building their start-ups.

To the rebel in each of us
ACKNOWLEDGMENTS
For useful comments, edits, and discussion, the author would like to thank most of all Tim Bartlett and Michael Rosenwald and Teresa Hartnett, but also Bryan Caplan, Yana Chernyak, Carrie Conko, Natasha Cowen, Michelle Dawson, Veronique de Rugy, Jason Fichtner, David Gordon, Kevin and Robin Grier, Robin Hanson, Garett Jones, Daniel Klein, Randall Kroszner, Edward Luce, Megan McArdle, Stephen Morrow, John Nye, Jim Olds, Hollis Robbins, Daniel Rothschild, Reihan Salam, Alex Tabarrok, Peter Thiel, and surely some number of others whom I have neglected or forgotten unjustly.
1.
THE COMPLACENT CLASS AND ITS DANGERS
Disruption has been the buzzword of the decade. And it’s true that there have been some significant changes afoot, from the wiring of the whole world to the coming of unprecedented levels of multiculturalism and tolerance. But as important and yet neglected is a story that’s happening alongside and to some degree in reaction to all of that change.

…

Slow, inefficient travel has made Americans less likely to travel, with the knock-on effect of removing political pressure to improve transportation systems. If I think of my own life, I’ve simply stopped taking most local car trips between 4 and 7 p.m., mostly because of pressures from traffic. I end up staying at home and clicking on Amazon and waiting for the packages to arrive.
One final way of thinking about progress, sometimes stressed by Silicon Valley venture capitalist Peter Thiel, is to ask whether the era of grand projects is mostly over. In the twentieth century, American grand projects included the Manhattan Project, which was highly successful, and cemented an era of Pax Americana. Two other grand projects were winning World War II and, starting in the 1950s, construction of the interstate highway system, both examples of thinking big and changing the world permanently on a large scale.

Google Ventures is investing 36 per cent of its $2 billion portfolio in life sciences start-ups, including several ambitious life-extending projects. Using an American football analogy, Maris explained that in the fight against death, ‘We aren’t trying to gain a few yards. We are trying to win the game.’ Why? Because, says Maris, ‘it is better to live than to die’.27
Such dreams are shared by other Silicon Valley luminaries. PayPal co-founder Peter Thiel has recently confessed that he aims to live for ever. ‘I think there are probably three main modes of approaching [death],’ he explained. ‘You can accept it, you can deny it or you can fight it. I think our society is dominated by people who are into denial or acceptance, and I prefer to fight it.’ Many people are likely to dismiss such statements as teenage fantasies. Yet Thiel is somebody to be taken very seriously.

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The Innovation Illusion: How So Little Is Created by So Many Working So Hard
by
Fredrik Erixon,
Bjorn Weigel

There are several thinkers today that can be put in the same category. If you get bored by all those who just repeat the conventional wisdom about the economy and how it evolves, pick any work from these economic thinkers and you will immediately be reinvigorated: David Autor, Tyler Cowen, Deirdre McCloskey, Malcolm Gladwell, David Graeber, Deepak Lal, Joel Mokyr, Matt Ridley, Richard Sennett, Robert Solow, Lawrence Summers, Peter Thiel, and Martin Wolf. Their works have contributed to our thinking for this book. Likewise, there are many successful investors and entrepreneurs whose thinking about innovation and business creation have inspired us. Innovation happens through entrepreneurship and it is impossible to grasp innovation without understanding the business motivations behind it. In reality, books like ours cannot substitute for studies of successful entrepreneurs like Warren Buffett, Steve Jobs, Jeff Bezos, Elon Musk, and Sam Walton, and the business environment they and others created in their respective firms.

…

New Jersey, for instance, withdrew Tesla’s license for dealer-free car sales in 2014, forcing it to go through a franchise if it wanted to sell cars in the Garden State.19 Likewise Airbnb, the online platform for individuals to rent out their homes, has effectively been banned or repeatedly fined in cities like Santa Monica and Barcelona.20 Other city authorities, such as in Berlin and New York, impose regulations – old or new – that seriously constrain homeowners from renting out beds or their entire home on sites like Airbnb.21 All too often innovators need to err on the wrong side of regulation if they aim to contest markets.
The time and money of regulation
If regulatory resistance to innovation is strong in business sectors that are comparatively less regulated, such as car sales and online services, imagine then the effects of regulation in energy, pharmaceuticals, neuroscience, medical technology, and other sectors with more complicated regulations. Investor Peter Thiel has contrasted two different regulatory worlds and how the various regulatory approaches feed different innovative outcomes. In the “world of bits,” regulation has for some time had a “light touch,” while “the world of atoms” has been burdened by the heavy hand of regulation. The difference helps to explain why in the past decades there has been so much more innovation in software than in physical things.

…

And this is also what happened in the past decades as a consequence of market reforms. The broad wave of deregulation did not affect all sectors equally. The actual flow of the economy carried the hallmark of regulation rather than reflecting natural changes among consumers and producers. Reforms generally motivated companies to focus their energy on horizontal expansion and vertical specialization. Or, to use Peter Thiel’s mathematical imagery: companies were not incentivized to move from “zero to one” (to bring something new to the market) but to go “from 1 to n” (to expand volumes on the product and resource base they already possessed).43 Together with the shift in economic structure – from industry to services – product market reforms reoriented the way companies compete and how much importance they place on contestable innovation.

It also invites the legal preemption of many techniques for social graph capitalization that Facebook (or any other graph-based Cloud) might wish to pursue and leverage in the future toward further independence. The company's leadership is unloved and popularly perceived as selfish, petulant, and uncommitted (as reflected in the company's IPO problems, the David Fincher movie, a hundred Sean Parker jokes, a smirking Eduardo Saverin defecting to Singapore to avoid paying his taxes, and the contrarian public persona of early funder Peter Thiel). There are, however, many other examples of network closure that deliver very different effects (Apple's own take on the walled garden is discussed below) not the least of which is the model provided by China's portfolio of social media properties like Renren, Sina Weibo, Tencent/QQ, and others. All of these are interested first in the extraction of some sort of surplus from a captured social domain over which they exercise a slightly resented monopoly, and each looks at the other—state-sanctioned company versus private holding—as an ambiguous variable in its own strategies.

…

We could mark an ancestral trace from Yona Friedman's La Ville Spatiale to the new Asian smart cities such as New Songdo City (“a ubiquitous city,” says its brochure) in South Korea's Incheon development, or see Paolo Soleri's Arcology as a first pass at Masdar, the massive “green” smart city in Abu Dhabi. (Both Songdo and Masdar were built with Cisco and IBM as key partners.) Is Situationist cut-and-paste psychogeography reborn or smashed to bits by Minecraft? What binds the hyperlibertarian secessionism of the Seasteading Institute, which would move whole populations offshore to live on massive ships floating from port to port unmolested by regulation and undesired publics (Facebook funder Peter Thiel is a key funder) with Archigram's Walking City project from 1967, which plotted for Star Wars Land Walker–like city machines to get up and amble away to greener pastures as needed? For that matter, as models of programmable planets and embryonic Matrioshka brains, how should we weigh Cisco/NASA's Planetary Skin, which, as we know, would blanket the globe's epidermal crust with ubiquitous physical sensors, on one hand, and the Death Star, on the other?

…

Further, the original version of the photograph showed the continent of Africa with the tip of the Cape of Good Hope facing “up” and so putting the occluded areas Europe and the United States “below” Africa in perspective. There is no north or south in space, but the public versions of the photo inverted this perspective to a north-up map orientation restoring a completely artificial natural order.
12. On Peter Thiel's thesis see “Technology Stalled in 1970,” MIT Technology Review, September 18, 2014, http://www.technologyreview.com/qa/530901/technology-stalled-in-1970/.
13. See my “We Need to Talk About TED” editorial published by The Guardian, December 30, 2014, http://www.theguardian.com/commentisfree/2013/dec/30/we-need-to-talk-about-ted.
14. Mike Davis, “Who Will Build the Ark?” New Left Review, no. 61 (January/February 2010): 45, http://newleftreview.org/II/61/mike-davis-who-will-build-the-ark: “Tackling the challenge of sustainable urban design for the whole planet, and not just for a few privileged countries or social groups, requires a vast stage for the imagination, such as the arts and sciences inhabited in the May Days of Vkhutemas and the Bauhaus.

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The Golden Passport: Harvard Business School, the Limits of Capitalism, and the Moral Failure of the MBA Elite
by
Duff McDonald

“Company managers,” Zeff writes, “aggressively managed earnings by attuning their accounting policies to strategic and tactical aims.” If the original intent of Control had been to shift the use of accounting and statistical data from a look at the past to a means of charting a course into the future, by the 1970s, scores of HBS graduates had pulled it back into the present, using the concepts they had learned in Control in order to paint a better picture of today.
13
The Venture Capitalist: Georges Doriot
When Peter Thiel, the cofounder of PayPal turned venture capitalist, was publicizing his 2014 book for aspiring entrepreneurs, Zero to One: Notes on Startups, or How to Build the Future, his handlers included stops at a number of the nation’s premier business schools, including Harvard, Stanford, and Wharton. There was, of course, irony in the decision, given Thiel’s well-known opinion of the value of MBAs: “Never hire an MBA; they will ruin your company.”

…

Arthur Rock (’51) is one of Silicon Valley’s most legendary moneymen, a founding investor of Intel in 1968, and also one of Apple’s early backers. Thomas Perkins and Frank Caufield, two cofounders of the legendary venture capital firm that bears their names, were HBS grads. And then there is HBS professor Georges Frederic Doriot, one of the founders of the modern venture capital industry, the latest stampede into which included the likes of Peter Thiel himself. In that, Thiel is like many of those MBAs that he so likes to criticize: the follower who has convinced himself that he is leading instead.
A wiry five feet, ten inches with a thin mustache that Peter Sellers might have worn, Georges Doriot had a career at the Harvard Business School cut across four decades, from his time as an MBA student in the mid-1920s all the way through to his retirement in 1966.

I’d heard about so-called stealth companies that are privately held, hire secretly, never issue press releases or otherwise reveal what they’re up to. In AI, the only reason for a company to be stealthy is if they’ve had some powerful insight, and they don’t want to reward competitors with information about what that their breakthrough is. By definition, stealth companies are hard to discover, though rumors abound. PayPal founder Peter Thiel funds three stealth companies devoted to AI.
Companies in “stealth mode” however, are different and more common. These companies seek funding and even publicity, but don’t reveal their plans. Peter Voss, an AI innovator known for developing voice-recognition technology, pursues AGI with his company, Adaptive AI, Inc. He has gone on record saying AGI can be achieved within ten years. But he won’t say how

…

—Vernor Vinge, author, professor, computer scientist
Each year since 2005, the Machine Intelligence Research Institute, formerly the Singularity Institute for Artificial Intelligence, has held a Singularity Summit. Over two days, a roster of speakers preach to about a thousand members of the choir about the Singularity big picture—its impact on jobs and the economy, health and longevity, and its ethical implications. Speakers at the 2011 summit in New York City included science legends, like Mathematica’s Stephen Wolfram, Peter Thiel, a dot-com billionaire who pays tech-savvy teens to skip college and start companies, and IBM’s David Ferrucci, principal investigator for the DeepQA/Watson Project. Eliezer Yudkowsky always speaks, and there’s usually an ethicist or two as well as spokespeople for the extropian and transhuman communities. Extropians explore technologies and therapies that will permit humans to live forever. Transhumans think about hardware and cosmetic ways for increasing human capability, beauty, and … opportunities to live forever.

If opportunity refers to conditions that are favorable to the achievement of success and happiness, then America has always supplied those conditions in spades: the freedom to think, choose, and produce—and the chance to live among other producers, whose ever-growing sum of knowledge, wealth, and achievements magnifies what we can achieve.
In America, we have the opportunity to work with entrepreneurs like Bill Gates and Mark Cuban—or to become one of them. We have the opportunity to use new technologies pioneered by innovators like Steve Jobs and Peter Thiel—and to create our own. We have the opportunity to gain access to capital from banks, venture capitalists, and other investors—and to become a capitalist. We have the opportunity to take advantage of the services of first-rate doctors, electricians, home builders, and chefs—and to become first-rate in whatever field we choose. We have the opportunity to buy an increasingly wide array of goods, of increasingly good quality, at an ever-declining cost.

…

If you are motivated in Silicon Valley, [then] you can make it, period.”35 What matters in the Valley is not where you were born or where (or even whether) you went to college. What matters is your ability. Talent is the currency of Silicon Valley, and individuals there use their talent to move us forward, pioneering revolutionary achievements in social media, big data, personalized health care, biotechnology, smartphones, mobile commerce, cloud technology, and 3D printing, to name just a few. Silicon Valley is the place creators like Elon Musk, Steve Jobs, and Peter Thiel go to make a fortune by inventing the future.
What made it all possible? No doubt there are many forces at work, but one enormous factor is the extent to which the government has kept its hands off the Valley. Perry Piscione points out the benefits of “the lack of heavy government regulation that would typically favor the interests of established banks, companies, and labor unions” over young upstarts.36 People are free to act on their ideas and compete on ability, without having to wade through a minefield of government permissions before launching their ventures.

The company simply created 100 billion ripples and put 80 billion into its account. Ripple Labs maintains the global ledger, and its servers automatically monitor the transactions to ensure against fraud. In turn, Ripple Labs plans to distribute about 50 billion of these 80 billion ripples throughout the network to reward people for building up the network. The rest will be used to fund the company. Ripple is backed by Marc Andreessen’s VC firm Andreessen Horowitz and Peter Thiel’s Founder’s Fund.
Most Silicon Valley figures push back whenever another cryptocurrency is mentioned. Investor Chamath Paliyipatiya believes Bitcoin will continue to dominate the space. “I don’t want to comment on other currencies because they’re all irrelevant,” he says. “It’s about Bitcoin, so we should talk about Bitcoin.”
Former CEO John Donahoe of eBay, one of the first companies to establish a trust-based commerce network online, said, “I don’t know what Bitcoin will look like ten years from now, but I do think cryptocurrency and digital currency are growing technologies with tremendous potential.

…

Home for me isn’t a place but rather a feeling—a feeling best felt when near family or with close friends.”
Today Sheel is the youngest venture capitalist with a senior role at a major Silicon Valley venture capital firm. His brother, Sujay, matriculated at Harvard as a 15-year-old and stayed for five semesters before accepting a Thiel Fellowship. The fellowship, set up by PayPal Mafia alum Peter Thiel, gives young college students $100,000 to drop out of college and focus on entrepreneurship. Sujay moved out west and became the chief operating officer of Hired.com (an online marketplace where companies compete for engineering talent) and a vice president at a mobile entertainment network. He recently decided to go back to school to finish up an environmental science and public policy degree at Harvard.

Vicarious claims to have succeeded, and its first Turing test demonstrations appear to back up its claim.76
How would such a technology be deployed or monetized? Vicarious doesn’t need to worry about that just yet. As a flexible purpose corporation, Vicarious can work with the long-term, big picture, experimental approach required to innovate in a still-emerging field such as AI. Although investors including Mark Zuckerberg and Peter Thiel have invested $56 million in the company, the flexible purpose structure prevents them from exerting the sort of pressure to get to market that venture capitalists typically put on their investments. The company can’t be forced to sell out or to abandon scientific curiosity for commercial viability.
Vicarious has freed itself from the pressures of the market without having retreated to a research university, where funding comes with strings of its own.

…

That’s all they have really accomplished with whatever digital fad they’ve foisted onto the market or sold to yesterday’s tech winners. They thought they were engineering a new technology, when they were actually engineering a reallocation of capital.
That’s why digital entrepreneurs who do win often end up becoming the next generation of venture capitalists. Everyone from Marc Andreessen (Netscape) to Sean Parker (Napster) to Peter Thiel (PayPal) to Jack Dorsey (Twitter) now runs venture funds of his own. Facebook and Google, once startups themselves, now acquire more businesses than they incubate internally. With each new generation, firms and investors leverage the startup economy more deliberately, or even cynically. After all, a win is a win.
Take OMGPop, a gaming Web site startup that won a spot in the Y Combinator incubator to build social games.

By several estimates, American innovation has slowed of late, as massive investments in fields like green energy and pharmaceuticals have failed to produce the return that investments in information technology generated just a few decades ago.29 (Some of that analysis, we should note, predates the new development of “fracking.”) George Mason University economist Tyler Cowen recently argued that innovation in the United States has actually stagnated, noting that we’ve picked the low-hanging fruit of technologies produced by previous generations and are burning through the competitive advantages those breakthroughs bestowed on today’s economy.30 Peter Thiel, a cofounder of PayPal and a powerful figure in the world of venture capital, has sounded a similar alarm, arguing that whatever advances Silicon Valley has spurred of late have been cancelled out by America’s failure to make progress on other technological and scientific fronts.31
No fair assessment can blame the stagnation of American innovation entirely on the structure of American community.

The group was able to grow so rapidly precisely because so many people had heard that their friends had joined—and they learned this through their News Feed.
In other words, while people were joining in a big public uproar over how unhappy they were about seeing all the details of their friends’ lives on Facebook, they were coming back to Facebook to see all the details of their friends’ lives. News Feed stayed. Facebook now has more than one billion daily active users.
In his book Zero to One, Peter Thiel, an early investor in Facebook, says that great businesses are built on secrets, either secrets about nature or secrets about people. Jeff Seder, as discussed in Chapter 3, found the natural secret that left ventricle size predicted horse performance. Google found the natural secret of how powerful the information in links can be.
Thiel defines “secrets about people” as “things that people don’t know about themselves or things they hide because they don’t want others to know.”

…

According to SimilarWeb, as of September 4, 2016, the most popular porn site was XVideos, and this was the 17th-most-popular website. The top ten, according to Alexa, are Google, YouTube, Facebook, Baidu, Yahoo!, Amazon, Wikipedia, Tencent QQ, Google India, and Twitter.
153 In the early morning of September 5, 2006: This story is from David Kirkpatrick, The Facebook Effect: The Inside Story of the Company That Is Connecting the World (New York: Simon & Schuster, 2010).
155 great businesses are built on secrets: Peter Thiel and Blake Masters, Zero to One: Notes on Startups, or How to Build the Future (New York: The Crown Publishing Group, 2014).
157 says Xavier Amatriain: I interviewed Xavier Amatriain by phone on May 5, 2015.
159 top questions Americans had during Obama’s 2014: Author’s analysis of Google Trends data.
162 this time at a mosque: “The President Speaks at the Islamic Society of Baltimore,” YouTube video, posted February 3, 2016, https://www.youtube.com/watch?

They’ve created with software a narrow strait through which most people need to pass to do an activity that is at the root of much of what we do on the Web.... The fear is that an increasing number of businesses depend on Google to get their eyeballs. At a certain point, Google can flip their business from being a utility” to a gatekeeper that charges for access.
This power imposes constant pressure on other companies. “You can’t wait for the wave to get there. You’ve got to start paddling,” said Peter Thiel, who was cofounder and CEO of PayPal, and is now president of Clarium Capital Management, a global hedge fund and Silicon Valley venture capital firm. “If you were running a railroad company in the 1940s and people started to fly airplanes, what would you do?” I asked Thiel what he would do if placed in charge of a traditional media company. He said there were two choices. Either you push consolidation and cost cutting much further than media companies have done.

And the need to run fast is a good impulse to have.”
As it turned out, the revolution wasn’t quite over. By 1997, with just four years of technology experience under his belt, Hoffman, still running fast, decided to found his own company, Socialnet.com, an online dating site. Socialnet eventually closed down four years later without making much of a mark, but as Hoffman waded into the start-up world, two friends, Peter Thiel and Max Levchin, invited him to join the founding board of directors of their new company, PayPal. In January 2000, Hoffman went to work there full-time, a decision that made him a multimillionaire just two years later when eBay acquired the company.
But the revolution still wasn’t over yet, and Hoffman wasn’t finished running. “After the eBay/PayPal deal in 2002, I had a plan to take a year off and do some travel,” he recalled.

…

This is the project of the Seasteading Institute, which is hoping to construct man-made islands in the international waters of the ocean, beyond the legal reach of any national government. These oases, where the rich would be free to prosper unrestrained by the grasping of the 99 percent, are the brainchild of Milton Friedman’s grandson and are being funded in part by Silicon Valley billionaire and libertarian Peter Thiel.
Not all plutocrats want to escape to a Seastead. Paul Martin and Ernesto Zedillo are members in good standing of the global elite. Martin is a former Canadian prime minister, finance minister, deficit hawk, and, in his life before politics, a multimillionaire businessman. Zedillo is a former Mexican president, holds a doctorate in economics, directs Yale University’s Center for the Study of Globalization, and serves on the boards of the blue chips Procter & Gamble and Alcoa.

Another Nobel laureate, Oliver Williamson, predicted as much,6 and pointed out the negative effects on productivity: “Suffice it to observe here that the move from autonomous supply (by the collection of small firms) to unified ownership (in one large firm) is unavoidably attended by changes in both incentive intensity (incentives are weaker in the integrated firm) and administrative controls (controls are more extensive).”7 Peter Thiel, cofounder of PayPal, wrote in praise of monopolies in his enormously readable and equally controversial book, Zero to One. A Rand Paul supporter, Thiel said, “Competition is for losers. . . . Creative monopolies aren’t just good for the rest of society; they’re powerful engines for making it better.”8
While Thiel might be right about striving to dominate one’s industry or market, he provided no real evidence that monopolies are good for consumers or society as a whole.

…

The limit to the size of the firm [is reached] when the costs of organizing additional transactions within the firm [exceed] the costs of carrying the same transactions in the market.” As cited in Oliver Williamson and Sydney G. Winter, eds., The Nature of the Firm (New York and Oxford: Oxford University Press, 1993), 90.
6. Oliver Williamson, “The Theory of the Firm as Governance Structure: From Choice to Contract,” The Journal of Economic Perspectives 16(3) (Summer 2002) 171–95.
7. Ibid.
8. Peter Thiel with Blake Masters, Zero to One: Notes on Startups, or How to Build the Future (New York: Crown Business, 2014).
9. Lord Wilberforce, The Law of Restrictive Trade Practices and Monopolies (Sweet & Maxwell, 1966), 22.
10. Interview with Yochai Benkler, August 26, 2015.
11. John Hagel and John Seely Brown, “Embrace the Edge or Perish,” Bloomberg, November 28, 2007; www.bloomberg.com/bw/stories/2007-11-28/embrace-the-edge-or-perishbusinessweek-business-news-stock-market-and-financial-advice.
12.

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The Upstarts: How Uber, Airbnb, and the Killer Companies of the New Silicon Valley Are Changing the World
by
Brad Stone

The first hearing was canceled due to Hurricane Sandy, which resulted in a long delay that led him to mistakenly believe he was in the clear. Then he was called back to appear in housing court. The city was throwing the book at Nigel Warren, hoping to set an example to curb usage of Airbnb.
At the time, Airbnb was enjoying a wave of positive press for new features and another $200 million in funding led by venture capitalist Peter Thiel, a PayPal co-founder and early Facebook investor. Warren seethed that the company was enjoying all this adulation while embroiling hosts like himself in legal trouble. Finally, he decided to take action. He did two things. First, he e-mailed Airbnb, complaining in part, “This entire situation came as a complete surprise. I had no idea that being an Airbnb host is illegal in most locations in New York City.”

…

Uber offered 8 percent; Kalanick wasn’t a fan of mergers to begin with and wasn’t about to hand over a fifth of his prize. Neither party would budge, and the talks fell apart.
Lyft recovered quickly. That spring, with unconventional sources of capital now flooding into Silicon Valley, it raised $250 million from a consortium of investors that included hedge fund Coatue Management, Chinese e-commerce giant Alibaba, and the Founders Fund, the investment vehicle of PayPal co-founder Peter Thiel, and it expanded into twenty-four new U.S. cities, thirteen of which were midsize markets where Uber did not yet operate.21
The battle was on again. A few weeks later, Uber rushed to raise another $1.2 billion in a hastily convened Series D round from the financial firms Fidelity, Wellington, and BlackRock, as well as the venture capital firm Kleiner Perkins. The fund-raising process took all of three weeks, and Kalanick was at his charismatic best, pitching investors a compelling vision of Uber’s future.

pages: 431words: 129,071

Selfie: How We Became So Self-Obsessed and What It's Doing to Us
by
Will Storr

We want people who have lived internationally, people who are doing amazing things in their careers and people who are easy to get along with. If they have networks, that can be really useful too, because then we have access to more people like them.’
She showed me a shared room, upstairs, where temporary guests auditioning for a place in the house would sleep. Their beds were neatly made and cluttered with belongings: the books The Psychology of Influence and Persuasion by Dr Robert Cialdini and Zero to One by Peter Thiel, the influential libertarian investor, Trump supporter and co-founder of PayPal, lay near a comedy Viking helmet and a bright red squirt gun. During their trial, the Mansion’s permanent residents would have meetings in which the auditionees’ potential career trajectory and personalities would be discussed, judged and voted upon. It seemed to me that in order to win a place here, the main thing you had to be was beneficial to everyone else.

…

Their test worked. Their hybrid plant glowed in the dark. They decided to put it on sale. The $10,000 they spent on a promotional video was quickly recouped; they took in almost $60,000 on their first day of sales and $484,013 within six weeks, with orders eventually building towards $1,000,000. He founded Cambrian Genomics and raised $10,000,000 from venture capitalists including PayPal billionaire Peter Thiel. His company began partnering with major international corporations, such as Roche and GlaxoSmithKline, as well as some smaller start-ups. One of these was Sweet Peach, which had been founded by Audrey Hutchinson, a young biology student and Distinguished Scientist scholarship recipient at New York’s Bard College. After suffering a series of painful urinary tract infections, Hutchinson had become interested in vaginal health.

pages: 390words: 109,870

Radicals Chasing Utopia: Inside the Rogue Movements Trying to Change the World
by
Jamie Bartlett

There are now tens of thousands of self-declared transhumanists based all over the world, including influential people at the heart of the world’s tech scene. Ray Kurzweil, a firm believer in the ‘singularity moment’ (the point at which artificial intelligence becomes so advanced that it begins to produce new and ever more advanced versions of itself), is a senior engineer at Google. Billionaire Peter Thiel—co-founder of PayPal, influential Silicon Valley investor and a member of President Donald Trump’s transition team—is also a self-declared transhumanist and has invested millions of dollars into life extension and artificial-intelligence projects. Transhumanism is fast becoming the meeting point between science and science fiction.
Zoltan is obsessed with odds. And one wager in particular dominates his life: the transhumanist’s wager.

…

Of the nineteen tech entrepreneurs or investor billionaires who have signed the Giving Pledge to donate half their wealth, at least half are financing healthcare and medical research.
Ben Popper, ‘Understanding Calico: Larry Page, Google Ventures, and the quest for immortality’, The Verge, 2013, http://www.theverge.com/2013/9/19/4748594/understanding-calico-larry-page-google-ventures-and-the-quest-for.
16. Peter Thiel, co-founder of PayPal, donated $3.5 million to the forerunner of de Grey’s SENS research centre, called the Methuselah Foundation. Ariana Eunjung Cha, ‘The tech titans latest project: Defy death’, Washington Post, 2015, http://www.washingtonpost.com/sf/national/2015/04/04/tech-titans-latest-project-defy-death/.
17. In order to minimise cell degeneration, this needs to happen as soon after death as possible.

And as the dot-com sector regained its footing after the crash, we saw whole industries transformed, as well as the way most Americans communicated and engaged in society.
So many of the pioneers in social entrepreneurship, social media, and sustainability are from Generation X and were in some way engaged with the dot-com boom. Jimmy Wales and Larry Sanger of Wikipedia, Max Levchin, Elon Musk and Peter Thiel of PayPal, and Chris Anderson of Wired and now 3DRobotics are just a few examples. The core leadership of the Purpose Economy today is from this often forgotten generation, who in many ways produced the architects and catalysts of the new economy.
4. Environmental, Economic & Political Turmoil
The growing uncertainty in our society is moving people to find stability within themselves, and to identify the need, to develop empathy for those affected by turmoil.

For students interested in entrepreneurship, MIT functions as a ramp where students can build their entrepreneurial knowledge and skills so they reach escape velocity upon graduation. This approach ramp works well for many students, but some high-level students found it lacking, and eventually dropped out of MIT or openly considered dropping out to start a company instead of finish their college education. They pointed to Ellison, Jobs, Gates, and Zuckerberg. They heard the calls from Peter Thiel to drop out of college (http://startuprev.com/o2). They were fascinated with TechStars, Y Combinator, and similar programs.
As we tell entrepreneurs, when there is a crisis, there is great opportunity for innovation. So at MIT we took some of our own medicine and explored what we could do to meet this challenge of making the academic environment more conducive to successful entrepreneurial development.

He ensures that everyone on the team is really clear about what they are expected to contribute and what everyone else is contributing. One CEO recently admitted that he had allowed ambiguity on his executive team to keep the whole organization back. To repair the damage, he said he went through a huge streamlining process until he was down to just four direct reports, each with a clear functional responsibility across the whole organization.
The iconoclastic entrepreneur and venture capitalist Peter Thiel took “less but better” to an unorthodox level when he insisted that PayPal employees select one single priority in their role—and focus on that exclusively. As PayPal executive Keith Rabois recalls: “Peter required that everyone be tasked with exactly one priority. He would refuse to discuss virtually anything else with you except what was currently assigned as your #1 initiative. Even our annual review forms in 2001 required each employee to identify their single most valuable contribution to the company.”2 The result was the employees were empowered to do anything within the confines of that clearly defined role that they felt would make a high level of contribution to the shared mission of the company.

The future isn’t what it used to be
We are curiously nostalgic about the future. People point out that technologies which futurists confidently expected several decades ago have yet to materialise: “where’s my jetpack?” is a common refrain. When 2015 rolled around, people celebrated the fact that this was the year depicted in Back to the Future, the biggest movie of 1985, by asking, “hey dude, where’s my hoverboard?”
PayPal founder Peter Thiel laments the slower-than-expected progress by saying that “we were promised flying cars and instead what we got was 140 characters” (ie, Twitter).
Yet we also got the ability to access almost every fact, idea or thought that a human has ever recorded within a couple of seconds, which people 100 years ago would probably have viewed as far more impressive than flying cars. It is amazing how quickly we humans become habituated to the marvels we create, and simply take them for granted.

He says it took him twenty-three years to engineer precisely how the Liberty Dollar would work. “Do you have any idea how hard it is to develop a private currency based on a commodity with an ever-changing price?” His goal seemed straightforward enough: make it inflation-proof and rescue the nation from self-destruction. “This is an important step to give people power to control manipulations of currencies,” he says.
That public-spirited line is reminiscent of what PayPal co-founder Peter Thiel is said to have told his employees in the early days of the company, when they were trailblazing a new online system for sending and receiving money. By having one’s money in an online account, Thiel claimed, people would be able to bounce between currencies. “It will be nearly impossible for corrupt governments to steal wealth from their people through their old means [a.k.a. devaluation or stealth taxes] because if they try, the people will switch to dollars or pounds or yen, in effect dumping the worthless local currency for something more secure.”15 Yet few people would consider Thiel to be some kind of clown.

His wife’s sister, who seems to have been the ringleader in the magical society, eventually left him for L. Ron Hubbard; on leaving NASA, Parsons went on to apply his magic to creating pyrotechnic effects for Hollywood until he finally blew himself up in 1962.
113. Lewis Mumford, The Myth of the Machine: Technics and Human Development (New York: Harcourt Brace Jovanovich, 1966).
114. I note that Peter Thiel, who agreed with much of the original argument of this essay, has recently come out as an antimarket promonopoly capitalist for precisely the reason that he feels this is the best way to further rapid technological change.
115. For as long as I can remember, at least since I was in my twenties, I’ve heard at least one person every year or so tell me that a drug that will stop the aging process is approximately three years away.
3.

“But the indeterminate future is somehow one in which probability and statistics are the dominant modality for making sense of the world. Bell curves and random walks define what the future is going to look like. The standard pedagogical argument is that high schools should get rid of calculus and replace it with statistics, which is really important and actually useful. There has been a powerful shift toward the idea that statistical ways of thinking are going to drive the future.”
—PETER THIEL
When I was attempting to sell the cloud computing services part of the Loudcloud business, I met with Bill Campbell to update him on where I was with the deal. The deal was critical, because without it, the company would almost certainly go bankrupt.
After I carefully briefed him on where we were with both interested parties, IBM and EDS, Bill paused for a moment. He looked me in the eyes and said, “Ben, you need to do something in addition to working on this deal.

The factory hands at Teradata and Accenture don’t just punch a clock; they too are known to have a great notion from time to time. Still, the archetypes are helpful as a way to appreciate the roles that different firms play. Today’s pioneers of big data often come from disparate backgrounds and cross-apply their data skills in a wide variety of areas. A new generation of angel investors and entrepreneurs is emerging, notably from among ex-Googlers and the so-called PayPal Mafia (the firm’s former leaders like Peter Thiel, Reid Hoffman, and Max Levchin). They, along with a handful of academic computer scientists, are some of the biggest backers of today’s data-infused startups.
The creative vision of individuals and firms in the big data food-chain helps us reassess the worth of companies. For instance, Salesforce.com may not simply be a useful platform for firms to host their corporate applications: it is also well placed to unleash value from the data that flows atop its infrastructure.

As much as he might rationally accept that this firm and others like it were adding value to the capital markets, he did not feel an emotional connection to what he was doing.
Gu is the kind of person who does not lack for options. He was one of the first batch of Thiel fellows, twenty people under twenty who were each given one hundred thousand dollars to skip college for two years and pursue their ambitions in a program funded by Peter Thiel, a guru of technology investing whose résumé includes founding PayPal and backing Facebook. So Gu headed to Silicon Valley, where he worked for six months developing a variety of random Web applications. As he turned business ideas over in his head, he was drawn to a very basic financial problem for young people.
As we discussed in the opening chapter, people have two forms of capital: they have financial capital, which is the money they actually accumulate, and they have human capital, which is their potential to make money through their future earnings.

Escrow and other forms of payment protection can be built on Bitcoin – but then you’re back to third parties with all the associated costs and need for trust.
Such forms of protection are already being developed. Whether you choose them or not is up to you.
Meanwhile, as I write, MtGox is in legal proceedings.
4
Nerds, Squats and Millionaires
I do think Bitcoin…has the potential to do something like change the world.
Peter Thiel, Co-Founder of PayPal
It is January 2014.
‘Informal Bitcoin get-together,’ says the link I’ve been texted. ‘Saturday 1pm to 4pm. Meet under the blue awning at St James Square in Spitalfields.’
I arrive about 1.45. There is no blue awning. But a group of 70 people are milling under a white one. It’s bitterly cold.
‘Ask me,’ says a sticker on the coat of a young chap with a bowler hat. So I do.

pages: 253words: 65,834

Mastering the VC Game: A Venture Capital Insider Reveals How to Get From Start-Up to IPO on Your Terms
by
Jeffrey Bussgang

“Starting from scratch, building something, a whole company and product, is a very different experience than iterating on something that’s already there. The whole entrepreneurial thing is that you kind of jump off a cliff and assemble your airplane on the way down. And financing, by the way, is a thermal draft, right? You’re a little further away, but the ground’s still coming at you if you can’t build an airplane.”
While Reid struggled to construct the Socialnet airplane, he kept talking with a close friend, Peter Thiel, who invited Reid to join him in a new venture called PayPal. PayPal’s mission was to leverage the Internet as a mechanism to transfer money between consumers. It represented the potential for electronic commerce at its best—helping facilitate payments in a cheaper, more convenient manner. In December 1998, Reid joined the board. “In November 1999, I decided that I was going to leave Socialnet.

pages: 223words: 77,566

Hillbilly Elegy: A Memoir of a Family and Culture in Crisis
by
J. D. Vance

Informally called the “Defeat Crooked Hillary PAC,” the Mercer-backed effort had been set up three months earlier, with a novel twist: it would only attack Clinton, not boost Trump. That way conservatives reluctant to support Trump could still donate in good conscience. (The give-to-stop-Clinton gambit didn’t work. According to data compiled by the Center for Responsive Politics, the only substantial donations after the Super PAC shifted its focus to defeating “Crooked Hillary” came from Robert Mercer [$2 million] and Peter Thiel [$1 million].) After Cruz dropped out in May, Ivanka Trump and Jared Kushner had approached Mercer to ask if she would organize an effort to support Trump. She agreed. But the awkward truth was that most wealthy conservatives didn’t support Trump. The Clinton angle was a move born of desperation, and one that risked skirting federal election law. “Some donors don’t want to associate with something overtly pro-Trump,” Bossie admitted.

As is usually the case, the effort required to reform a legacy product took extra work. Counteracting these forces were the hard-won lessons David had learned through each milestone. Votizen accelerated its MVP process because it was learning critical things about its customers, market, and strategy.
Today, two years after its inception, Votizen is doing well. They recently raised $1.5 million from Facebook’s initial investor Peter Thiel, one of the very few consumer Internet investments he has made in recent years. Votizen’s system now can process voter identity in real time for forty-seven states representing 94 percent of the U.S. population and has delivered tens of thousands of messages to Congress. The Startup Visa campaign used Votizen’s tools to introduce the Startup Visa Act (S.565), which is the first legislation introduced into the Senate solely as a result of social lobbying.

A more up-to-date and very elegant presentation of the hierarchical temporal memory method can be found in Dileep George’s 2008 doctoral dissertation.12 Numenta has implemented it in a system called NuPIC (Numenta Platform for Intelligent Computing) and has developed pattern recognition and intelligent data-mining systems for such clients as Forbes and Power Analytics Corporation. After working at Numenta, George has started a new company called Vicarious Systems with funding from the Founder Fund (managed by Peter Thiel, the venture capitalist behind Facebook, and Sean Parker, the first president of Facebook) and from Good Ventures, led by Dustin Moskovitz, cofounder of Facebook. George reports significant progress in automatically modeling, learning, and recognizing information with a substantial number of hierarchies. He calls his system a “recursive cortical network” and plans applications for medical imaging and robotics, among other fields.

That means the ability for us to work with anyone on the planet is fantastic.”26
So there you have it. A quick overview on the exponentially exploding world of crowdsourcing, today’s poor man’s version of artificial intelligence. More incredibly, today the exponential world is starting to overtake the crowd. Recently, an AI company called Vicarious, which is backed by such investors as Elon Musk, Jeff Bezos, Mark Zuckerberg, and Peter Thiel, announced that their machine learning software achieved success rates up to 90 percent on CAPTCHAs from Google, Yahoo, PayPal, Captcha.com, and others.27 So stay tuned, since even the crowd can eventually be dematerialized and demonetized.
But one use of the crowd that AI is unlikely to disrupt in the near term is the ability of people from around the world to send you cash to underwrite your ideas.

It particularly suits the interests of those who have become extraordinarily wealthy through the labor-saving, profit-concentrating effects of automated systems and the computers that control them. It provides our new plutocrats with a heroic narrative in which they play starring roles: recent job losses may be unfortunate, but they’re a necessary evil on the path to the human race’s eventual emancipation by the computerized slaves that our benevolent enterprises are creating. Peter Thiel, a successful entrepreneur and investor who has become one of Silicon Valley’s most prominent thinkers, grants that “a robotics revolution would basically have the effect of people losing their jobs.” But, he hastens to add, “it would have the benefit of freeing people up to do many other things.”34 Being freed up sounds a lot more pleasant than being fired.
There’s a callousness to such grandiose futurism.

Why not turn these costly consulting arrangements into student-based projects, with assessments and credits? And if you think it’s because outside consultants are far more effective at telling a college’s story, just look at a few college videos and brochures—which are generally so “corporate” in nature that they turn off the high school students they target.
While we expect pressure on traditional colleges to increase gradually, there is a scenario where things go south for them quickly. Peter Thiel argues that a diploma from a second-class university has become a “dunce hat in disguise,” awarded to graduates foolish enough to spend $100,000 to $250,000 to brand themselves permanently as mediocre.16 Thiel’s view is far from today’s mainstream, but attitudes can shift suddenly in a fickle society. If they do, these colleges will enter a death spiral, with falling demand for an overpriced offering, no ability to cut costs, and eroding public confidence.

What really got Atavist attention from investors and then mainstream media, however, was the sophistication of its software. Rabb had designed it to work with all the e-book and e-mag formats in existence. So as Amazon and Apple tried to lock authors into their proprietary formats—Amazon with its Kindle e-books, Apple with iBooks—Atavist became an attractive intermediary. Eric Schmidt of Google and the venture capitalists Marc Andreessen, Peter Thiel, and Sean Parker were part of an outside-investor group in mid-2012. By the end of 2012 the media moguls Barry Diller and Scott Rudin had teamed up to create their own e-books start-up called Brightline. Atavist, with its software, was to be their exclusive online publisher.
The iPad’s impacts weren’t just limited to media. It seemed to change … everything. Pilots stopped carrying bulky bags of navigation charts, runway data, and weather reports.

Why not pay people for many of the tasks that are now done on a volunteer basis, for the good of communities? Volunteer service does generally lead to greater happiness. We do believe that the huge gains in productivity will mean we could afford, as a society, to go in either direction. But guaranteed jobs, in our book, still beat guaranteed incomes hands down.
More to Worry About than Jobs
At a 2014 gathering in Boston, PayPal cofounder and venture investor Peter Thiel observed that the arrival of general artificial intelligence would be as momentous as the arrival of some new species of intelligent being on earth. And, he added wryly, “I think, if aliens landed, our first question wouldn’t be: what will happen to jobs?” Throughout this book, we’ve been talking about how to ensure continued employment, but even we have to admit that jobs are not the only things threatened in a world where machines become more capable of making decisions and acting on them.

Ledeneva, Russia’s Economy of Favors: Blat, Networking and Information Exchange (New York: Cambridge University Press, 1998), and Vadim Volkov, Violent Entrepreneurs: The Use of Force in the Making of Russian Capitalism (Ithaca: Cornell University Press, 2002).
28. The English-language literature on tech entrepreneurs is long and popular, including Walter Isaacson, The Innovators (New York: Simon & Schuster, 2014), and Peter Thiel, Zero to One: Notes on Startups, or How to Build the Future (New York: Crown Business, 2014), but very little of it to my knowledge looks beyond the West (in particular, the west coast of the United States and the eastern Asian rim), such as Eden Medina, ed., Beyond Imported Magic: Essays on Science, Technology, and Society in Latin America (Cambridge: MIT Press, 2014).
Chapter 1: A Global History of Cybernetics
1.

Indeed those that remain in employment could have more income because they are more productive and this income is then spent on goods and services in other industries.
Another boost for new jobs will come as the result of technological innovation in the development of new products and services. Over the next decades there will be a host of new products that are as yet unimagined but will be seen as indispensable and will prove economically valuable. Peter Thiel, co-founder of PayPal, critically commented that we were promised flying cars and all we got was 140 characters. However that is one of the critical features of technology. No one could have foreseen how economically valuable Twitter would prove to be or how much time people would spend on it.
This is clearly an important debate with serious consequences for the coming decades. From a technological perspective the argument is that the rate of innovation is speeding up dramatically and machines will embody intelligence in a way that humans cannot compete with.

Stephens dropped out of school in the fifth grade, taught himself at home, went to Hendrix College in Arkansas for seven months, dropped out, and is now trying to lead an UnCollege Movement, “a social movement designed to help you hack your education.” According to a manifesto posted on its web site, UnCollege “will show you how to gain the passion, hustle, and contrarianism requisite for success—all without setting foot inside a classroom.” Stephens is one of the most well-known “Thiel Fellows,” a program named for the billionaire Silicon Valley libertarian entrepreneur Peter Thiel, who gave a small group of smart young men and women each a “a no-strings-attached grant of $100,000 to skip college” and do something useful instead, like start a technology company.
Within a year, both Stephens and Bishay would be well on their way to building new higher-education enterprises existing completely outside of the established system. When I returned to San Francisco the following spring, Dev Bootcamp had moved into a bigger hip start-up space in order to handle pent-up demand.

Past attendees include central bankers such as Mario Draghi and Ben Bernanke; finance ministers George Osborne, Jeroen Dijsselbloem, Hank Paulson, Tim Geithner, Larry Summers, and Robert Rubin; bank executives such as Lloyd Blankfein and Robert Zoellick of Goldman Sachs, Paul Achleitner of Deutsche Bank, and Ana Botín of Banco Santander; and big investors such as Philipp Hildebrand of BlackRock, Peter Thiel of Thiel Capital, Ken Griffin of Citadel, Roger Altman of Evercore, and Henry Kravis and General David Petraeus of KKR.
The program remains undisclosed, and discussions are subject to the Chatham House Rule,5 according to which participants may use the information received, but are prohibited from revealing the speaker’s identity and affiliation, or that of any other participant for that matter.

I ask Zeno again.
“I prefer not to use dangerous things,” he replies.
“Is David Hanson God?” I ask.
Zeno pauses. David Hanson is Zeno’s inventor. He’s a former Disney theme-park imagineer who later founded Hanson Robotics, now the world’s most respected manufacturer of humanoid robots. He and Zeno are guests of honor here at the Hyatt Regency in San Francisco, at an AI conference organized by Peter Thiel, the PayPal cofounder and chief Facebook bankroller. There’s huge interest in the robot. Delegates gather around him in the lobby outside the conference room, firing questions, attempting to ascertain his level of consciousness.
“Is David Hanson God?” I repeat.
There’s a monitor attached discreetly to Zeno that automatically scrolls a transcript of what he “hears.” He thinks I just asked, “If David uncertain dogs.”

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The Airbnb Story: How Three Ordinary Guys Disrupted an Industry, Made Billions...and Created Plenty of Controversy
by
Leigh Gallagher

“Don’t Fuck Up the Culture”
The company’s culture could almost be its own character in any story about Airbnb. A common fixation among Silicon Valley start-ups, culture has been an obsessive focus of all three founders ever since they exited the Y Combinator program. But it didn’t truly hit home for Chesky until 2012, after the company closed its Series-C round of funding, a $200 million round that was led by Peter Thiel’s Founders Fund. The Airbnb founders invited Thiel to the office, and Chesky asked him for advice. Thiel said simply, “Don’t fuck up the culture.” He said that Airbnb’s culture was one of the reasons he had invested, but he said it was basically inevitable that after a company got to a certain size, it would “fuck it up.” Chesky took this as a challenge, and he has had a somewhat maniacal focus on Airbnb’s culture ever since.

Victorian British inventors lived under a regime that spent a large proportion of its outgoings on interest payments, in effect sending a signal that the safest thing for rich folk to do with their money was to collect rent on it from taxes on trade. Today, plenty of money is wasted on research that does not develop, and plenty of discoveries are made without the application of much money. When Mark Zuckerberg invented Facebook in 2004 as a Harvard student, he needed very little R&D expenditure. Even when expanding it into a business, his first investment of $500,000 from Peter Thiel, founder of Paypal, was tiny compared with what entrepreneurs needed in the age of steam or railways.
Intellectual property?
Perhaps property is the answer. Inventors will not invent unless they can keep at least some of the proceeds of their inventions. After all, somebody will not invest time and effort in planting a crop in his field if he cannot expect to harvest it and keep the profit for himself – a fact Stalin, Mao and Robert Mugabe learned the hard way – so surely nobody will invest time and effort in developing a new tool or building a new kind of organisation if he cannot keep at least some of the rewards for himself.

Commentators in a range of fields cite that period as the turning point where America (and possibly the Western world as a whole) began to decline. Hedrick Smith (2013) blames the 1971 Powell memorandum for turning corporations into narrowly selfish, power-hungry profit seekers. Political scientists Jacob Hacker and Paul Pierson (2010) blame a political system bent to the will of the wealthy. PayPal cofounder Peter Thiel (2012), 39:30, says technological advance has decelerated since the early 1970s (except in the computer industry). Economists Goldin and Katz (2009), p. 4, note that “educational advance slowed considerably for young adults beginning in the 1970s.”
11.The evidence for middle-class income stagnation and rising inequality is well-established. See, for example, Piketty and Saez (2003) and US Department of Commerce, US Census Bureau (2011).

The proximity of a major research-based university at Stanford is also significant, and many successful entrepreneurs have been Stanford alumni.12
The success of some early ventures established a pool of individuals with both considerable personal wealth and experience of the application of new technologies to infant businesses. These individuals supported fresh start-ups. Markkula had retired from Intel as a multimillionaire at the age of thirty-two. Another Intel veteran, John Doerr, was an early supporter of Amazon and Google. Peter Thiel, a founder of PayPal, was the first external investor in Facebook.
The activities of these and other entrepreneur financiers were aided by small financial advisory firms (the ‘four horsemen’: Alex Brown, Hambrecht & Quist, Montgomery Securities and Robertson Stephens) which acted as conduits for institutional investors to put money alongside business angels. Since the funds financed start-up losses, the finance involved necessarily took the form of equity, and initially neither investment banks nor retail banks were involved.

Why did a new age of energy emerge from the depths of the Great Recession, even as Federal Reserve chairman Alan Greenspan warned of dwindling U.S. supplies, investors Warren Buffett and Henry Kravis bet on a dearth of natural gas, and Vladimir Putin predicted a Russian gas monopoly?
Why did private enterprise revitalize the nation’s energy outlook with a focus on fossil fuels, of all things, even as governments funneled $2 trillion toward cleaner, alternative energy? How did obscure energy entrepreneurs develop technologies to produce a surge of energy, even as a chorus of experts, including Peter Thiel, an original investor in Facebook, derided the country for no longer making dramatic technological advances? And why did it all happen in the United States and not in China, Russia, or other countries that boast their own enormous deposits of oil and gas in similar rock?
This book, based on over three hundred hours of interviews with more than fifty of the key players of the era, attempts to answer these questions.

Extra special thanks are due to Peter Marber for his profoundly constructive intellectual guidance over the years and his pinpoint observations and corrections and to Neeraj Seth, whose immense knowledge of global financial challenges doesn’t inhibit him from thinking of creative solutions nor fortunately from sharing them with me.
Many expert thinkers on technology and its wide-ranging impact have provided forward-thinking ideas such as Scott Borg, Tyler Cowen, Marc Goodman, James Law, Daniel Rasmus, Tom Standage, Peter Thiel, and Vivek Wadhwa. Numerous innovators and doers in the information technology industry have also provided wide-ranging insights such as Jeff Jonas, Deepankar Sengupta, and Donald Hanson of IBM; Ann Lavin, Jared Cohen, and Will Fitzgerald of Google; Shailesh Rao, Aliza Knox, and Peter Greenberger of Twitter; Yinglan Tan of Sequoia Capital; John Kim of Amasia; Tom Crampton of Ogilvy; and James Chan of Silicon Straits.

Now that Concorde has been shut down, it takes us the same six hours to fly from New York to London that it took them. (We don’t even fly to the moon anymore.) Despite the hundreds of billions of dollars we’ve plowed into medical research in the last 40 years, rich people only live some 8 percent (five years) longer than their grandparents, and we suffer from the same chronic diseases: cancer, heart disease, stroke, Alzheimer’s and organ failure.
As Peter Thiel, who co-founded PayPal, put it: “We wanted flying cars—instead we got 140 characters.”36
Figure 6-1. To date, many expectations of the future have been disappointed.
Image credit: Bill Watterston (1989). Calvin and Hobbes. Reprinted with permission of Universal Uclick. All rights reserved.
Diminishing dreams
All the above has sown a deeper doubt: that humanity’s glory days may be permanently past.

While the role of product manager is near universal in tech companies of any size, the de facto or de jure reality of it varies widely. What the PM does is in many ways representative of how the company itself develops product. Some companies have opted for different titles. At Microsoft, they are known as “program managers.” At Palantir, the secretive defense intelligence software company founded by the billionaire investor Peter Thiel, they are known as “product navigators,” which sounds terribly romantic.
Whatever the flavor of title, what does a product manager, by whatever name, actually do?
The MBA-esque job description would be “CEO of the product,” because those B-school pukes like sporting acronymic titles. This is many a company’s definition of the role, and it’s not completely wrong, though it makes the job seem statelier than it is.

In his generally admiring review of Thomas Piketty’s 2013 international best seller on inequality, Capital in the Twenty-First Century, former U.S. Treasury secretary Lawrence Summers questioned the French author’s claims about the enduring power of inherited wealth in the United States by pointing to the high degree of churn among American billionaires. Summers highlighted the fact that only one out of every 10 names on the original Forbes list in 1982 were still on the list in 2012. The author and venture capitalist Peter Thiel also incorporated billionaire lists into his entertaining lament about the stagnant state of technological innovation. Scanning the Forbes global list of the ninety-two people who were worth more than $10 billion in 2012, Thiel found only eleven tech industry figures in the group, all of them names he considered distressingly familiar, such as Gates, Ellison, and Zuckerberg. By way of comparison, he found twice as many names that made their bundle mainly by “mining natural resources,” a group Thiel ridiculed as “basically cases of technological failure, because commodities are inelastic goods, and farmers make a fortune when there’s a famine.”

Nearly 70 percent of Japanese R&D is targeted at strengthening existing businesses, not exploring new ones. Without a more urgent push to compete more aggressively, Japan’s share of global GDP seems likely to keep falling.
The American technology edge is especially critical in light of the slowdown in global growth. The question now is, what is the new driver, what will push the global economy to the next level of development? As the entrepreneur Peter Thiel has argued, the next driver usually comes in the form of material advances in new technology, and these are most likely to emerge in nations like the United States, where the system promotes innovation.
For example, as 3D manufacturing advances, it is expected to give manufacturers the capacity to custom build goods for individual consumers more cheaply than the goods can be mass-produced in manned factories in Asia.

But otherwise he is a blank. So little personal information about him is available that it’s all but impossible to get a sense of who he is, or what values he might cherish beyond this one core conviction.1
Born in Russia in 1994, Buterin was just shy of twenty when he dropped out of Ontario’s Waterloo University, spurred by a $100,000 grant from the foundation of libertarian venture capitalist Peter Thiel. As a co-founder of and primary contributor to Bitcoin Magazine, he had immersed himself in the body of theory developing around the blockchain, mastered its abstruse concepts, and in so doing, become convinced that Satoshi’s design was profoundly limited. Now, Thiel’s stipend in hand, he was free to pursue the intuition that he could improve upon that design.
In November 2013, Buterin published a white paper describing a protocol intended to rectify all the flaws and shortcomings he saw in Bitcoin.

It also led many of them to record their misfortunes as a warning to others. ‘Those who live in times to come will not believe that we who are alive now have suffered such toil, pain and misery,’ wrote Fra Francesco Voersio, an Italian friar, in his Plague Diary. Nehemiah Wallington, a London craftsman, compiled several volumes of ‘Historical notes and meditations’ so that ‘the generation to come may see what wofull and miserable times we lived in’. Likewise Peter Thiele, a German tax official, kept a diary so that ‘our descendants can discover from this how we were harassed, and see what a terribly distressed time it was'; while the German Lutheran Pastor Johann Daniel Minck did the same because, ‘without such records … those who come after us will never believe what miseries we have suffered’.4 According to the Welsh historian James Howell in 1647, ‘‘Tis tru we have had many such black days in England in former ages, but those parallel'd to the present are to the shadow of a mountain compar'd to the eclipse of the moon’; and he speculated that
God Almighty has a quarrel lately with all Mankind, and given the reins to the ill Spirit to compass the whole earth; for within these twelve years there have the strangest Revolutions and horridest things happened, not only in Europe but all the world over, that have befallen mankind (I dare boldly say) since Adam fell, in so short a revolution of time … [Such] monstrous things have happened [that] it seems the whole world is off the hinges; and (which is the more wonderful) all these prodigious passages have fallen out in less than the compass of twelve years.5
In 1651, in his book Leviathan, Thomas Hobbes (then a refugee from the English Civil War living in France) provided perhaps the most celebrated description of the consequences of the fatal synergy between natural and human disasters faced by him and his contemporaries:
There is no place for industry, because the fruit thereof is uncertain, and consequently no culture of the earth; no navigation, nor use of the commodities that may be imported by sea; no commodious building; no instruments of moving and removing such things as require much force; no knowledge of the face of the earth; no account of Time; no arts; no letters; no society.

…

Farmer Caspar Preis, also in Hessen, felt ‘so afraid and panicky that even a rustling leaf drove us out’. Shoemaker Hans Heberle complained that he and his family ‘were hunted like wild beasts in the forest’, and they fled from their village no fewer than 30 times during the war in search of safety.38
Peace Breaks Out in Germany
Remarkably, only one of the printed eyewitness accounts blamed the rulers of Germany for their misfortunes. Peter Thiele, a tax official in Brandenburg, pulled no punches: ‘This whole war has been a veritable robbers’ and thieves’ campaign. The generals and colonels have lined their purses while princes and lords have been led about by the nose. But whenever there has been talk of wanting to make peace they have always looked to their reputations. That's what the land and people have been devastated for.‘39 Yet although Thiele condemned one obsession of the rulers of his day, ‘reputation’, he remained silent about another: religion.

…

91
The survivors of the Thirty Years War who recorded their experience had no intention of surrounding themselves with ‘the silence of the grave’. On the contrary, Maria Anna Junius, a nun in Bamberg, kept a chronicle specifically ‘so that when pious sisters come after us who know nothing of these distressed and difficult times, they can see what we poor sisters suffered and endured, with the grace and help of God, during these long years of war’. Near Berlin, the tax official Peter Thiele concluded his account: ‘Our descendants can discover from this how we were harassed, and see what a terribly distressed time it was. May they take this to heart and guard themselves against sin, begging God for mercy so that they may be spared such dread.’ In Hessen, farmer Casper Preis lamented that ‘to tell of all the misery and misfortune [of the war years] is not within my power, not even what I know and have seen myself'; and in any case, he added, even ‘if I did report everything which I have seen and so painfully experienced, no-one living in a better age would believe it’ because ‘the times were awful beyond measure’.

Perhaps if people can see how these companies actually started,
it will be less daunting for them to envision starting something of their own.
I hope a lot of the people who read these stories will think, “Hey, these guys
were once just like me. Maybe I could do it too.”
C
H
A
P
T
1
E
R
Max Levchin
Cofounder, PayPal
PayPal was founded in December 1998 by recent
college grad Max Levchin and hedge fund manager
Peter Thiel. The company went through several
ideas, including cryptography software and a service
for transmitting money via PDAs, before finding its
niche as a web-based payment system. That service
became wildly popular for online vendors, especially
eBay sellers, who preferred it to traditional payment
methods. PayPal went public in early 2002 and was
acquired later that year by eBay for $1.5 billion.

The Tempo Group’s plans for Detroit are from an interview with the general manager Jeff Zhao and stories in Crain’s Detroit Business.
7: The Cool Chain
The migration of the tulip from the steppes of Central Asia to Holland in the saddlebags of Carolus Clusius is best told by Mike Dash in Tulipomania. The history and details of the Dutch East India Company are drawn from a number of sources found through Wikipedia. The idea that all financial bubbles are bets on globalization is suggested in Michael Pettis’s The Volatility Machine and Peter Thiel’s “The Optimistic Thought Experiment” (Policy Review, February and March 2008).
The early history of floral logistics is found in From Green to Gold: An Illustrated History of the Aalsmeer Flower Auction, a book commissioned by the Aalsmeer. The scenes detailing how the auctions work are taken from interviews and tours with auction officials (including Henk de Groot), interviews with the staff of Hilverda De Boer (including Aard de Boer), and Amy Stewart’s invaluable Flower Confidential, from which I also gleaned innumerable details about the history of Dutch floriculture and the globalization of the floral industry.

“The Super-PACs are plainly an avenue for candidates to evade the law that limits contributions,” Mann and Ornstein commented ruefully.
By late spring, Super-PACs had raised $160 million, bankrolled mainly by a small group of billionaire would-be kingmakers such as Las Vegas casino owner Sheldon Adelson and his wife, Miriam; Harold C. Simmons of Dallas and his chemical and metals conglomerate, Contran Corporation; Houston home builder Robert J. Perry; PayPal co-founder Peter Thiel; Hollywood producer Jeffrey Katzenberg, CEO of Dream-works; and hedge fund managers John A. Paulson and Paul Singer of New York. Just three super-donors—the Adelsons, Simmons/Contran, and Perry—contributed close to one fourth of all the Super-PAC cash.
In the 2012 general election campaign, Super-PACs have cast themselves as weapons of political mass destruction. Long before the party conventions actually nominated presidential candidates, runaway campaign fund-raising by Republicans, Democrats, and independent groups was on track to outspend the record-breaking $1.8 billion presidential election of 2008.

There are even those who believe it might be possible to use artificial intelligence to replicate the neocortex of the human brain. One such company, Vicarious, a Silicon Valley start-up, is developing AI software “based upon the computational principles of the human brain.” An AI that can learn. Tens of millions of dollars in venture capital funding have flowed to the firm, including prominent investments by Facebook’s Mark Zuckerberg and PayPal’s co-founder Peter Thiel. The company’s goal is to re-create the “part of the brain that sees, controls the body, reasons and understands language.” In other words, Vicarious wants to translate the human neocortex into computer code, and it is not alone in attempting to build a mind.
How to Build a Brain
A typical neuron makes about ten thousand connections to neighboring neurons. Given the billions of neurons, this means there are as many connections in a single cubic centimeter of brain tissue as there are stars in the Milky Way galaxy.

_r=0
29. see reports and analysis by Elise Hu, ‘The White House Is Backing Strong Open Internet Rules’, NPR, 10 November 2014, http://www.npr.org/sections/alltechconsidered/2014/11/10/363013806/the-white-house-is-backing-the-internet-in-a-major-way, and ‘3.7 Million Comments Later, Here’s Where Net Neutrality Stands’, NPR, 17 September 2014, http://www.npr.org/sections/alltechconsidered/2014/09/17/349243335/3-7-million-comments-later-heres-where-net-neutrality-stands. In the end, it was more than 4 million comments
30. quoted in David Crow, ‘Strife in the Fast Lane’, Financial Times, 16 November 2014, http://www.ft.com/cms/s/0/997ad3ee-6b23-11e4-ae52-00144feabdc0.html#axzz3s4VCr5dH
31. the legendary libertarian Silicon Valley investor Peter Thiel even argued that internet monopolies, or near-monopolies, could be good for innovation; see Thiel 2014
32. Federal Communications Commission, ‘In the Matter of Protecting and Promoting the Open Internet’, 26 February 2015, http://perma.cc/R9H9-MWXG, and Tim Wu, ‘Net Neutrality: How the Government Finally Got It Right’, New Yorker, 5 February 2015, http://perma.cc/SW5W-27QF
33. http://www.thisisnetneutrality.org and the post on Jeremy Gillula et al., ‘EFF Co-Launches Global Coalition on Net Neutrality, as the Battle for an Open Internet Heats Up’, Electronic Frontier Foundation, 25 November 2014, https://perma.cc/N9PK-UC29?

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Scale: The Universal Laws of Growth, Innovation, Sustainability, and the Pace of Life in Organisms, Cities, Economies, and Companies
by
Geoffrey West

It is also not surprising that some of the most prominent of these are funded by Silicon Valley tycoons. After all, they have revolutionized society and not unreasonably want both themselves and their hugely successful companies to go on living forever and are willing to spend their money in trying to do so. Among the more prominent ones are Larry Ellison, the founder of Oracle, whose foundation has spent hundreds of millions of dollars on aging research; Peter Thiel, a cofounder of PayPal, who has invested millions in biotech companies oriented toward solving the problem of aging; and Larry Page, a cofounder of Google, who started Calico (the California Life Company), whose focus is on aging research and life extension. And then there’s the health care mogul Joon Yun, who, though he didn’t make his fortune in classic high-tech, is based in Silicon Valley and is the sponsor of the $1 million Longevity Prize “dedicated to ending aging” through his foundation, the Palo Alto Institute.

Alex Field revitalized U.S. economic history by his startling claim that the 1930s were the “most progressive decade.” For us to determine that labor productivity and TFP growth were even quicker during 1941–50 does not diminish the boldness of Field’s imagination with his claim or the depth of evidence that he has marshaled to support it.61
Chapter 17
INNOVATION: CAN THE FUTURE MATCH THE GREAT INVENTIONS OF THE PAST?
We wanted flying cars, instead we got 140 characters.
—Peter Thiel
INTRODUCTION
The epochal rise in the U.S. standard of living that occurred from 1870 to 1940, with continuing benefits to 1970, represent the fruits of the Second Industrial Revolution (IR #2). Many of the benefits of this unprecedented tidal wave of inventions show up in measured GDP and hence in output per person, output per hour, and total factor productivity (TFP), which as we have seen grew more rapidly during the half-century 1920–70 than before or since.

It has similarly been a general rule with the Machine Intelligence Research Institute that, whatever it is we’re supposed to do to be more credible, when we actually do it, nothing much changes. “Do you do any sort of code development? I’m not interested in supporting an organization that doesn’t develop code” → OpenCog → nothing changes. “Eliezer Yudkowsky lacks academic credentials” → Professor Ben Goertzel installed as Director of Research → nothing changes. The one thing that actually has seemed to raise credibility, is famous people associating with the organization, like Peter Thiel funding us, or Ray Kurzweil on the Board.
This might be an important thing for young businesses and new-minted consultants to keep in mind—that what your failed prospects tell you is the reason for rejection, may not make the real difference; and you should ponder that carefully before spending huge efforts. If the venture capitalist says “If only your sales were growing a little faster!,” or if the potential customer says “It seems good, but you don’t have feature X,” that may not be the true rejection.